Just as a refresher: “In 1977, Congress gave the Fed two main tasks: Keep the prices of things Americans buy stable, and create labor-market conditions that provide jobs for all the people who want them. The Fed has developed a toolkit to achieve these dual goals of inflation and maximum employment. But interest-rate changes make…
Category: Interest Rates
Found an interesting paper from AQR about Risk Parity performance. Critics argue risk parity is destined to perform poorly in rising rate environment, and thus conclude that the strategy is currently unattractive since interest rates are still at low levels and will eventually rise. Interesting part is when highlight October 1979 (a couple of months…