Bond Outlook June 25th

The US authorities continue in their state of denial about the economy, and Bernanke is suggesting that it has been saved from collapse by the Fed’s rate cuts, freeing the central bank to tackle inflation. The US people think otherwise, reporting their lowest level of confidence in 16 years and turning away from McCain as the Presidential candidate who is likely to carry on the Bush economic policies (or should we use the less dignified word “practices”).