Fixed Income

Fixed Income and Bond Markets

Fixed Income in the United States  generally receives a smaller proportion of media attention relative to equity coverage. The news flow that comes from Apple product launches and SpaceX subsume headlines relative to the mundane business of bond issuance - yet bond and credit markets arguably have more direct effects on a broader demography in terms of revealing the cost of money. 

The Fixed Income market includes corporate and government agency debt. Both sectors raise money through issuing bonds. According to the Securities Industry and Financial Markets Association, 

• The Equities Boom: Driven by sustained economic expansion, corporate earnings, and generational shifts in technology, the total market capitalization of the public U.S. stock market has scaled to an unprecedented $69 trillion (represented broadly by the Russell 3000 Index).

• The Debt Footprint: The absolute size of total U.S. debt outstanding exceeds $55 trillion. For comparison, this completely dwarfs the domestic equity markets of global counterparts like China (~$17 trillion) and Japan (~$6 trillion).

• The Debt-to-GDP Reality: With U.S. Gross Domestic Product expanding alongside escalating fiscal deficits, the sovereign Treasury issuance alone stands above $30.9 trillion, locking the Debt-to-GDP ratio well north of 100%.