Welcome to the DC Today, your daily market synopsis of the Dividing Cafe, brought to you every Monday through Thursday to bring you up-to-date information and perspective on financial markets.

Hello and welcome to the Tuesday edition of the DC Today. A pretty slow and boring day in markets, but it has not been slower boring overall

for, let's say, the last 20 days. In the last 20 trading days, the market is up over 10%. That rates above

in the 99th percentile of all time.

It just simply, that kind of movement in that period of time simply does not happen very often.

The last couple of days may have been slow, but when you look at how much things dropped

in September and October and how much they've rallied since.

You certainly have had more significant tug of war going on over the last few months.

What has continued, even the last couple of days, is this incredible rally in the bond market.

And the tenure dropped another six basis points today down to 4.33%.

And we were down, you know, 9 to 12 basis points at most spots in the yield curve, three-year, five, year, seven, you're kind of the middle of the curve.

So you got a huge rally in bonds there. And basically what you're left

with is an ultra short part of the yield curve. Let's call it one month, three months, that's still

around 5.4 percent where the Fed Funds rate is. But then when you go from two or three months to

two or three years, it drops a full percentage point, a hundred basis

points from roughly 5.4 to 4.4. And so the term structure right now is such that the term

premium is negative. And all that means is that, and I talked about this at Dividend Cafe a month or so ago,

that growth expectations and inflation expectations are very low,

and you're basically getting the short end of the curve plus a negative term premium in the bond yield curve.

And I believe that speaks to growth and inflation expectations.

And yet, hopefully, at the point at which the Fed does begin cutting the short end,

the term premium will hold, excuse me, the term structure will be such that longer dated

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