Fixed Income Readjustment Has Taken Place, Says Invesco's Brill

The video discusses the challenges faced by debt markets in 2022, highlighting a significant downturn in fixed income and stock markets due to rapid interest rate hikes. It explores the potential for recovery in 2023, emphasizing the role of higher yields and the impact of economic slowdown on credit spreads. The discussion also covers the balance between credit risk and treasury investments.

What is one reason why back-to-back negative years for fixed income are uncommon?

• The economy always grows steadily.

• Interest rates never increase consecutively.

• The stock market always recovers quickly.

• Higher yields provide a buffer against volatility.

What was the impact of the rapid increase in basis points on the bond market in 2022?

• It resulted in a stable bond market.

• It led to a significant downturn.

• It caused a boom in the bond market.

• It had no effect on the bond market.

How did the bond market perform in 2022?

• It remained stable throughout the year.

• It saw a 10% increase.

• It experienced a 20% downturn.

• It was unaffected by economic changes.

Are current credit spreads indicative of a recession?

• They are inconclusive about a recession.

• Yes, they clearly indicate a recession.

• No, they are not pricing in a recession.

• They suggest a booming economy.

What is the current state of yields in the market?

• Yields are at an all-time low.

• Yields are very elevated.

• Yields are decreasing rapidly.

• Yields are stable and unchanging.