On Demand

We don’t know anyone who’s seen the latest Godzilla movie, yet it’s grossed more than $375 million worldwide. On the other hand, the clearly-destined-to-be-a-cult-classic Vampire Academy has barely scraped in $15 million. Life, we suppose, is unfair.

While not as profound on the scale of life’s mysteries, we have also cogitated on the ongoing spectacle of falling interest rates, and their impact on mutual fund flows.

Despite two thumbs up from public equities last week, as the Dow and S&P 500 hit record highs – suggesting investor confidence in corporate earnings over the next six months – bond yields continue to slump. The ten-year Treasury remains around 2.60%, off from 3.0% since January 1.

One theory is that investors were spooked by last week’s sneak preview of first quarter GDP dropping 1%, down from the positive 2.6% showing for 4Q 2013. Another is that rate movements are now being driven less by economic concerns than technical issues, including higher demand globally for fixed income products.