Risk Assets Helped by Low Long Yields, Morgan Stanley's Weinstein Says

The video discusses the rally of risk assets despite higher yields, questioning if this is a constructive trend or a case of 'ostrich syndrome.' It highlights investors' preference for cash and risk-free rates, noting that a 5% return is attractive. The discussion also covers the current state of 10-year treasuries, economic activity, and the yield curve, suggesting that investors continue to buy risky assets until higher yields are achieved on the longer part of the curve.

What is the main concern about the rally in risk assets?

• It is a sign of economic recovery.

• It might be a case of ignoring potential risks.

• It indicates a strong market foundation.

• It shows a decrease in investor confidence.

Why are investors interested in cash and short-term investments?

• They offer high returns with low risk.

• They are more volatile than long-term investments.

• They are less affected by inflation.

• They provide a hedge against currency fluctuations.

What is the issue with the current 10-year treasury yields?

• They are not affected by market conditions.

• They are fluctuating too much.

• They are not high enough to attract investors.

• They are too high for investors.

What economic indicators are mentioned as holding up?

• Interest rates and consumer spending.

• Stock market indices and GDP.

• Earnings and housing.

• Unemployment rates and inflation.

What is surprising about the yield curve given the current economic conditions?

• It has remained flat.

• It has inverted.

• It has not steepened as expected.

• It has steepened significantly.