July 2021

So far this year, dividend growth stocks have been the stars and are anticipated to continue to perform well due to collapsing bond yields. These same collapsing yields also helped our growth stocks in June after China did a commodity “dump” to squelch soaring material prices.

We are clearly in an inflationary environment that is expected to persist due to accommodative central banks. The latest catalyst for bond yields collapsing was the European Central Bank’s (ECB) recent announcement that it would tolerate up to 2% annual inflation over the “medium term” and essentially ignored the current annual inflation target of just below 2%. So just like the Fed, the ECB is going to allow inflation to temporarily “overshoot” its inflation targets. The ECB essentially …