Investor Psyches: Wall Street and Currency Crisis

investor psyches: Read September is the worst month for stocks and it's even gloomier after a downbeat August Shalett said trade tensions between the U.S. and China, an inversion in the closely watched yield-curve between the 10-year Treasury TMUBMUSD10Y, 2.53% and both the 3-month bill TMUBMUSD03M, -0.01% and 2-year note TMUBMUSD02Y, 3.07%, where the longer-term yield falls below its shorter-term counterparts, has heightened anxieties on Wall Street about the health of the economy, according to Market Watch. On top of that, geopolitical worries from Britain's problem-filled exit from the European Union, a brewing political and currency crisis in Argentina, protests in Hong Kong and skirmishes in Iran are also weighing on investor psyches. The Baker, Bloom & Davis Economic Policy Uncertainty Index tracking hundreds of articles referencing the economy or uncertainty, among other terms, to gauge monthly monetary-policy uncertainty showed policy uncertainty hitting a three-year high see attached chart . With recession signals already flashing, this kind of uncertainty could be dangerous as it inhibits consumption and capital spending, wrote Morgan Stanley Wealth Management's chief investment officer, Lisa Shalett, in a Tuesday note. That concatenation of worries has helped to drive investors into the perceived safety of bonds and has delivered a fillip to gold prices GCZ19, -0.62%, which topped 1,555 an ounce on Tuesday, while the Dow Jones Industrial Average DJIA, 0.91%, the S&P 500 index SPX, 1.08% and the Nasdaq Composite Index COMP, 1.30% lumbered lower on Tuesday but were still within a reasonable distance from their all-time highs, despite the whipsaw action of late. Bonds are too expensive for long-term investors to hedge short-term stock weakness and international stocks are too cheap to abandon as they have priced the bad news. What's an investor to do Shalett says sit tight for next few weeks because global debt and U.S. stocks are too pricey. (news.financializer.com). As reported in the news.