Credit markets have largely been ignoring traditional market fundamentals. 4.00% GDP growth in the second quarter, healthy housing data and improving employment numbers should all point to higher rates, especially with artificial stimulus ending sometime in October as QEIII winds down. One yearmarket fundamentals ignored ago, rates were nearly one-half percent higher than they are today. Many back then wondered how quickly rates would pop above 5.00% to 5.50%. But it never happened.

Investors are putting their money in safety and in today’s geopolitical world the safest place is in the United States. There are some that are saying the 10 year Treasury could float down to the 2.00% level in its current march to lower yields. All this points to a stock market in the doldrums, right? But nothing could be further from the truth. Today, the Dow jumped 175.83 to close at 16838.74 and the NASDAQ hit its highest levels not seen in more than 14 years, back in March of 2000. Again, concerning market fundamentals, investors seem to be paying very little attention to them.

On the consumer front, the University of Michigan’s consumer sentiment report, released monthly, came in right at 79.2 from 81.8 the previous month. This is the lowest reading since November of last year.

This week the Fed’s annual meetings take place in Jackson Hole, Wyoming and Fed Chair Yellen will make a public appearance at the event, hopefully offering clues as to the current stance and future moves from the Fed. There have been conflicting attitudes from various Fed Governors and many are waiting to see if the dovish approach is the preferred path or more FOMC members will begin to tilt toward raising rates before the end of the year. So far rates have trended downward from their highs at the beginning of the year and have been below 4.20% since mid-May.