Unsubscribe

Confirm you would like to unsubscribe from this list

Don't save
Cancel

Remove strategy

Confirm you would like to remove this strategy from your list

Welcome to Thornburg

Please select your location and role to help personalize the site.
Please review our Terms & Conditions

For Institutional / Wholesale / Professional Clients

The content on this website is intended for institutional and professional investors in the United States only and is not suitable for individual investors or non-U.S. entities. Institutional and professional investors include pension funds, investment companies registered under the Investment Company Act of 1940, financial intermediaries, consultants, endowments and foundations, and investment advisors registered under the Investment Advisors Act of 1940.

TERMS AND CONDITIONS OF USE

Please read the information below. By accessing this web site of Thornburg Investment Management, Inc. ("Thornburg" or "we"), you acknowledge that you understand and accept the following terms and conditions of use.

Disclaimers

Products or services mentioned on this site are subject to legal and regulatory requirements in applicable jurisdictions and may not be licensed or available in all jurisdictions and there may be restrictions or limitations to whom this information may be made available. Unless otherwise indicated, no regulator or government authority has reviewed the information or the merits of the products and services referenced herein. Past performance is not a reliable indicator of future performance. Investments carry risks, including possible loss of principal.

Reference to a fund or security anywhere on this website is not a recommendation to buy, sell or hold that or any other security. The information is not a complete analysis of every material fact concerning any market, industry, or investment, nor is it intended to predict the performance of any investment or market.

All opinions and estimates included on this website constitute judgements of Thornburg as at the date of this website and are subject to change without notice.

All information and contents of this website are furnished "as is." Data has been obtained from sources considered reliable, but Thornburg makes no representation as to the completeness or accuracy of such information and has no obligation to provide updates or changes. Thornburg disclaims, to the fullest extent of the law, any implied or express warranty of any kind, including without limitation the implied warranties of merchantability, fitness for a particular purpose and non-infringement.

If you live in a state that does not allow disclaimers of implied warranties, our disclaimer may not apply to you.

Although Thornburg intends the information contained in this website to be accurate and reliable, errors sometimes occur. Thornburg does not warrant that the information to be free of errors, that the functions contained in the site will be uninterrupted, that defects will be corrected or that the site and servers are free from viruses or other harmful components. You agree that you are responsible for the means you use to access this website and understand that your hardware, software, the Internet, your Internet service provider, and other third parties involved in connecting you to our website may not perform as intended or desired. We also disclaim responsibility for damages third parties may cause to you through the use of this website, whether intentional or unintentional. For example, you understand that hackers could breach our security procedures, and that we will not be responsible for any related damages.

Thornburg Investment Management, Inc. is regulated by the U.S. Securities and Exchange under U.S. laws which may differ materially from laws in other jurisdictions.

Online Privacy and Cookie Policy

Please review our Online Privacy and Cookie Policy, which is hereby incorporated by reference as part of these terms and conditions.

Third Party Content

Certain website's content has been obtained from sources that Thornburg believes to be reliable as of the date presented but Thornburg cannot guarantee the accuracy, timeliness, completeness, or suitability for use of such content. The content does not take into account individual investor's circumstances, objectives or needs. The content is not intended as an offer or solicitation with respect to the purchase or sale of any security or other financial instrument or any investment management services, nor does it constitute investment advice and should not be used as the basis for any investment decision.

Suitability

No determination has been made regarding the suitability of any securities, financial instruments or strategies for any investor. The website's content is provided on the basis and subject to the explanations, caveats and warnings set out in this notice and elsewhere herein. The website's content does not purport to provide any legal, tax or accounting advice. Any discussion of risk management is intended to describe Thornburg's efforts to monitor and manage risk but does not imply low risk.

Limited License and Restrictions on Use

Except as otherwise stated in these terms of use or as expressly authorized by Thornburg in writing, you may not:

  • Modify, copy, distribute, transmit, post, display, perform, reproduce, publish, broadcast, license, create derivative works from, transfer, sell, or exploit any reports, data, information, content, software, RSS and podcast feeds, products, services, or other materials (collectively, "Materials") on, generated by or obtained from this website, whether through links or otherwise;
  • Redeliver any page, text, image or Materials on this website using "framing" or other technology;
  • Engage in any conduct that could damage, disable, or overburden (i) this website, (ii) any Materials or services provided through this website, or (iii) any systems, networks, servers, or accounts related to this website, including without limitation, using devices or software that provide repeated automated access to this website, other than those made generally available by Thornburg;
  • Probe, scan, or test the vulnerability of any Materials, services, systems, networks, servers, or accounts related to this website or attempt to gain unauthorized access to Materials, services, systems, networks, servers, or accounts connected or associated with this website through hacking, password or data mining, or any other means of circumventing any access-limiting, user authentication or security device of any Materials, services, systems, networks, servers, or accounts related to this website; or
  • Modify, copy, obscure, remove or display the Thornburg name, logo, trademarks, notices or images without Thornburg's express written permission. To obtain such permission, you may e-mail us at info@thornburg.com.

Severability, Governing Law

Failure by Thornburg to enforce any provision(s) of these terms and conditions shall not be construed as a waiver of any provision or right. This website is controlled and operated by Thornburg from its offices in Santa Fe, New Mexico. The laws of the State of New Mexico govern these terms and conditions. If you take legal action relating to these terms and conditions, you agree to file such action only in state or federal court in New Mexico and you consent and submit to the personal jurisdiction of those courts for the purposes of litigating any such action.

Termination

You acknowledge and agree that Thornburg may restrict, suspend or terminate these terms and conditions or your access to, and use, of the all or any part this website, including any links to third-party sites, at any time, with or without cause, including but not limited to any breach of these terms and conditions, in Thornburg's absolute discretion and without prior notice or liability.

Decline
Give Us a Call

Fund Operations
800.847.0200

FIND ANOTHER CONTACT
Person holds rope in between their hands
Markets & Economy

Observations: Recession, Rate Hikes and Low Volatility

Co-Heads of Investments Ben Kirby and Jeff Klingelhofer discuss the chance of a recession in the U.S., continued Fed tightening and low volatility.

Read Transcript
Observations: Recession, Rate Hikes and Low Volatility

Adam Sparkman:        Welcome back and thanks for joining us for today’s Quarterly Observations in Fixed Income and Global Equities. My name is Adam Sparkman and I’m a client portfolio manager here at Thornburg Investment Management. Today, I’m joined by our co-heads of investment, Ben Kirby and Jeff Klingelhofer. Gentleman, thanks so much for joining us today. So Ben, given the resilience of the labor market, expectations or a broad-based US recession seemed to have declined a bit over the last quarter. Has your base case regarding the timing of a US recession shifted in recent months as well?

Ben Kirby:      You know, it has, Adam. I think calling a recession timing is a lot like watching an apple fall from a tree. You can observe the external forces that are gonna make it happen eventually, but the exact time is a bit more difficult. That said, there are a lot of external forces that are acting on the economy today. We have higher insurance rates, we have the Fed balance sheet contracting, um, so overall, liquidity is tightening, and we think that probably eventually does call the slowdown that we’ve seen in 2023 turn into a recession probably in early 2024.

Adam Sparkman:        So, Jeff, headline inflation in the US has definitely continued to recede really over the past 12 months, but the PCE, in particular, remains stubbornly above the Fed’s 2 percent target. With the central banks’ recent shift to a more reactive approach, given the high level of core inflation and the tight labor market that we have here in the US, do you expect the Fed to keep raising rates in 2023?

Jeff Klingelhofer:        You know, I think we do, right? What we’ve seen is parts of overall inflation have come down. Goods inflation is broadly back under control and, and well within the, the, the Fed’s 2 percent range and comfort zone, but much like Ben was saying, right unemployment and just the broad labor picture – and it used to be incredibly, incredibly strong – and that’s pushing up the level of services inflation, and so really, the Fed has been forced to react much like we have in markets. The Fed has been forced to react to really watch labor market conditions incredibly, incredibly closely, focusing on things like the quits rate, right? Or, or the vacancies relative to the overall unemployment rate. You know, I think from the Fed perspective, we’ve talked about this a little bit in the past, it, it hasn’t just been the greatest monetary experiment in human history, it’s really been the greatest social experiment in human history. We taught our, all of ourselves that we can borrow at incredibly low rates and really, the cost of money has been free, and the Fed wants to undo that, so my expectation is yes, we’ll continue to see the Fed raise rates, so long as inflation remain, remains stubbornly above their 2 percent target. I think they’re really looking to get it back to that 3 ½, 4 range, which we’re seeing some signs that it’s falling towards that, but we’re not there yet, um, so for, for me, yes, continued rate hikes and, and certainly a longer pause than the market was expecting.

Adam Sparkman:        So, Ben, volatility in financial assets has quieted in recent months, which feels pretty standard in recovering or rising markets like we’ve seen. Do you expect this kinda low volatility environment we’ve been in to continue through the second half of the year or do you think volatility will resume as this potential recession looms.

Ben Kirby:      Yeah, volatility tends to be very episodic. It’ll be, it’ll be low for a long time and then when an event happens, that’s when it spikes up. So, this year, it’s been a bit of a Goldilocks scenario, if you will in particular, expectations were very low going in to the year and growth has remained positive, even as the Fed hikes have slowed and we’ve had a nice disinflationary environment. So the big question is how far will inflation go down and how much economic contraction will be needed to achieve that. So, I would guess that yes volatility probably does increase as we near the next recession but again, the timeline of that is going to be tricky.

The views expressed are subject to change and do not necessarily reflect the views of Thornburg Investment Management Incorporated. This information should not be relied upon as a recommendation or investment advice and is not intended to predict the performance of any investment or market.

This is not a solicitation or offer for any product or service, nor is it a complete analysis of every material fact concerning any market, industry, or investment. Data has been obtained from sources considered to be reliable. Thornburg makes no representations as to the completeness or accuracy of such information and has no obligation to provide updates or changes. Thornburg does not accept any responsibility and cannot be held liable for any person’s use of or reliance on the information and opinions contained herein.

Investments carry risks, including possible loss of principal.

Outside the United States

This is directed to INVESTMENT PROFESSIONALS AND INSTITUTIONAL INVESTORS ONLY and is not intended for use by any person or entity in any jurisdiction or country where such distribution or use would be contrary to the laws or regulations applicable to their place of citizenship, domicile, or residence.

Thornburg is regulated by the U.S. Securities and Exchange Commission under U.S. laws, which may differ materially from laws in other jurisdictions. Any entity or person forwarding this to other parties takes full responsibility for insuring compliance with applicable securities laws in connection with its distribution.

For Australia: Thornburg holds a foreign AFSL 526689.

For Hong Kong: This article is issued by Thornburg Investment Management (Asia) Limited (“Company”), a wholly-owned subsidiary of Thornburg Investment Management, Inc. The Company is currently licensed with the Hong Kong SFC for Type 1 and Type 9 regulated activity, with the CE No.: BPQ208.

The material is only intended for Individual, Corporate and Institutional Professional Investor Use Only and may not be reproduced or redistributed to any person without the written consent of Thornburg Investment Management (Asia) Limited or its affiliated companies.

The material has not been reviewed by the Securities and Futures Commission of Hong Kong. This document is for informational purpose only and should not intended to constitute any tax, accounting, regulatory, legal, insurance or investment advice and does not constitute any offer or solicitation to offer or recommendation of any investment product/service from the Company.

The information provided is not intended to predict the performance of any investment or market. Data has been obtained from sources considered reliable. Notwithstanding, the Company makes no representations as to the completeness or accuracy of such information or opinion and has no obligation to provide updates or changes. The Company does not accept any responsibility and cannot be held liable for any person’s use of or reliance on the information and opinions contained herein.

Investment involves risks. Past performance is not a guide to future performance and should not be the sole factor of consideration when selecting a product. You should not make investment decision solely based on this general information. If you have any queries, please contact your financial advisor and seek professional advice. All financial investments involve an element of risk.

Discover more about:

Stay Connected

Subscribe now to stay up-to-date with Thornburg’s news and insights.
Subscribe

More Insights

Racers at the finish line on a track
Global Equity

Forget the Magnificent 7 – Why You Should Invest in Europe’s Fantastic 5

Europe has its own crop of market-beating growth stocks that are overlooked compared to the Magnificent Seven in the US.
Choosing between an older advisor and a younger advisor.
Investor Advice

Should You Opt for an Older or Younger Financial Adviser?

Do you want the wisdom that comes with age or the innovation that comes with youth? Maybe you can have both with an advisory team.
Markets & Economy

Observations: The Value of Dividends and Munis to Stoke Income

Our Co-Heads of Investments make the case for dividend-paying stocks and the tax-free feature of Munis as tax hikes are possible, given our government debt levels.
Markets & Economy

Observations: Market Concentration and the Fed’s Policy Outlook

Our Co-Heads of Investments discuss whether the equity market rally is finally broadening and whether the Fed's forecast for three rate cuts makes sense.
Markets & Economy

Observations: Are Investors Too Complacent?

Our Co-Heads of Investments discuss whether the financial markets' substantial gains following last autumn's 'Fed pivot' left investors smug amid potential dangers.
Woman with her smart phone and plexus connection
Global Equity

Avoiding Concentration Risk in AI: Is It Time for a Reality Check?

Overexuberance for all things AI can create concentration risk. See how we’re curating diversified exposure designed to perform over the long term.

Our insights. Your inbox.

Sign up to receive timely market commentary and perspectives from our financial experts delivered to your inbox weekly.