- Business Week, November 13,
2007
MARKET SNAPSHOT: Stocks Come Roaring Back
The inflation data coming out Nov. 14-15 could shake people up,
as it will seem as if inflation is getting out of hand, warned Bill
Tedford, fixed income strategist at Stephens Capital Management in
Little Rock, Ark. The consumer price index on a trailing 12-month
basis is due for a sharp increase over the next three months as the
deflationary months when energy prices were falling in the fall
2006 are replaced by the latest months, when oil prices have made
such big gains, he stated. While interest rates could head upward
for a brief period, Mr. Tedford sees this as just a temporary bulge
in inflation, which should decline meaningfully in the first
quarter of 2008.
-
Associated Press, October 31,
2007
Treasuries Drop On Disappointing Federal Reserve Statement
Warning Of Inflation Risks
Treasury prices caved
after the Federal Reserve, while cutting interest rates a quarter
point, warned that higher inflation risks could make further
reductions unlikely. The main reason the bond market does not like
the statement is that it indicates the Fed is on pause, barring
some economic weakness that they don't see and we don't see either,
said Alan Tedford, fixed income portfolio manager at Stephens
Capital Management. If the Fed concludes inflation is the primary
risk to the economy, it could in theory switch to a bias toward
rate increases. However, Mr. Tedford said this was unlikely as many
expect inflationary pressures to ease at the start of 2008.
- REUTERS, October 25, 2007
U.S. TREASURY OUTLOOK – Consumer’s Mettle A Key Test For
Bonds
Mr. Bill Tedford, director of fixed income strategy at Stephens
Capital Management, expects the implosion in real estate prices to
affect consumer spending for some time to come. He believes that
the economy will slow down and recession is not out of the
question. Mr. Tedford expects the Fed to cut rates at its
policy-setting meeting next week and beyond.
- REUTERS, October 19, 2007
Economic Backdrop Eerily Similar To 1987 Crash
Though some economic conditions are the same to the 1987 stock
market crash, there are also very big differences. According to
Bill Tedford, director of fixed income strategy at Little Rock,
Arkansas-based Stephens Capital Management, the main dissimilarity
is that the market in '87 was dramatically overpriced before all
that happened. By a common method of measuring stocks' value, Mr.
Tedford said Wall Street was 35 percent overvalued in October 1987.
Fast-forward to today and, by the same measure, the market is 35
percent undervalued, Mr. Tedford added.
-
TALK BUSINESS W/Roby Brock, September
25, 2007
PERSPECTIVE: Feds Could Move Rates Again
In a Q&A interview with "Talk Business," Mr. Bill Tedford, EVP
and fixed income strategist at Stephens Capital Management,
discussed ongoing Fed actions and the impact on the bond market.
The Fed is clearly worried that the economy is slipping rapidly in
part because consumers are concerned about their net worths
declining since the value of their homes are falling, stated Mr.
Tedford. Other Fed studies have implied that consumers have been
spending 5% to 10% of their home price appreciation. This combined
with rising oil prices and the recent seizing up of the credit
markets could quite possibly push us into recession, he continued.
The Fed has to be proactive because the economy reacts slowly to
cuts in interest rates, stated Mr. Tedford.
- Business Week, August 30, 2007
Bernanke Under The Microscope: The Fed Chief’s Words Are
Being Weighed Carefully
The key issue facing Federal Reserve Governor Ben Bernanke:
whether to cut interest rates. Fed action in the next few weeks
could have a significant impact on U.S. economic growth. Bill
Tedford of Stephens Capital Management believes Bernanke needs to
telegraph the Fed’s message to the markets in his upcoming speech
or else there could be a big shock on Sept. 18, the sort of
disruption the Fed tries to avoid. If he's leaning toward a rate
cut, says Mr. Tedford, the Fed would stress the economic damage
that has been done by the credit problems.
-
Business Week, August 17, 2007
Fed Move Lifts Stocks: Bernanke & Co Have Answered
Market’s Pleas
On Friday morning, the Federal Reserve
made an unusual move of cutting the discount rate to ease credit
worries at troubled financial institutions. The discount rate --
the interest rate that the Fed charges to make direct loans to
banks, was lowered from 6.25% to 5.75%. Bill Tedford of Stephens
Capital Management said he was a little underwhelmed by the Fed
move, which by itself probably won’t solve the market's problems.
The cut is largely symbolic, he explained, because very few
institutions take advantage of the discount window anyway. However,
the Fed policymakers may be creeping their way toward interest rate
cuts, stated Mr. Tedford, who watches the Fed closely.
- Business Week Online, June 5,
2007
Market Snapshot: Stocks Lower after Bernanke
Speech
U.S. stocks moved lower Tuesday on concerns about high interest
rates after a speech by the Fed chairman and economic data pointing
to a growing economy. Bond markets put pressure on stocks as yields
approached 5% on two- and ten-year Treasuries. Federal Reserve
Chairman Ben Bernanke, in a speech Monday morning, said housing
could remain a drag on the economy longer than expected.
Some still believe the Fed could cut rates later this year.
"Inflation has been moderating," says Bill Tedford of Stephens
Capital Management. He says interest rates are more likely to fall
than rise over the long term. Bernanke believes in the dangers of
deflation and will move swiftly to cut rates if inflation gets too
low, Tedford says.
- Investor’s Business Daily, May 16,
2007
Core Inflation Cools, Giving Fed Options As Economy
Slows
Consumer inflation eased in April, government data showed on May
15, giving the Federal Reserve more room to maneuver as the economy
slows. The consumer price index rose 0.4% in April, down from
March's 0.6%, the Labor Department said. Core prices, which exclude
food and energy, rose 0.2%, in line with views and just over
March's 0.1% gain. Core CPI rose 2.3% vs. a year earlier. That's
still above the Fed's 1%-2% unofficial comfort zone, but it's the
smallest gain in a year.
Analysts have debated whether the Fed should raise interest
rates to curb inflation or lower them to prop up the flagging
economy. Some analysts said recent data will spur the Fed to end
its tightening bias and eventually trim rates.
Alan Tedford, lead portfolio manager of $600 million in fixed
income assets at Stephens Capital Management in Little Rock, AR,
thinks inflation is heading lower and interest rates are heading
lower.
- The Wall Street Journal, April 18,
2007
Treasuries Get A Lift For Now
Tame inflation data put Treasury investors back in a cheery
mood, sending prices higher and yields ticking lower. But those
still hovering on the sidelines wondering whether to jump back into
government bonds may do better to hold off for now; for lower
yields and higher prices to truly take, expectations that the
economy will slow and inflation moderate still need to be confirmed
by a consistent run of data.
Bill Tedford, director of fixed income strategy at Stephens
Capital Management, said the expected economic slowdown in the U.S.
will be a creeping process, and will become even more apparent six
months from now. Weakness will spread from housing to the consumer,
making bonds an even more attractive investment as the months go
by, he said.
- Dow Jones Newswires, March 20,
2007
OFF THE RUN: Treasuries Set To Break Free From Stock
Markets
A promising sign for the Treasury market's return to economic
fundamentals: the opinion of many portfolio managers that the tie
between stock and bond markets won’t last. Bill Tedford, director
of fixed income strategy at Stephens Capital Management, for one,
isn't very worried that Treasuries will be dictated by stocks for
much longer. Mr. Tedford tends to look at this activity as noise in
the short term.
- REUTERS, March 14, 2007
Bonds fall in reaction to higher stocks
Normally, Treasuries are not driven by the stock market, though
sometimes there is a fear factor driving a rally in Treasuries, as
over the past couple of weeks, noted Bill Tedford, fixed income
strategist with Stephens Capital Management in Little Rock,
Arkansas. But what really drives interest rates in the long run is
inflation, and there are two more key data points (PPI and CPI) to
be announced in the coming weeks, according to Mr. Tedford.
The views expressed in these article
excerpts and hyperlinks were those of the portfolio manager as of
each article's publication date and are subject to change without
notice. For the period ending December 31, 2007, the portfolio's
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can significantly impact short-term performance. Actual results of
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