Money & Investing – Banks.com

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The news that consumer confidence and retail sales in November are both higher is helping things in terms of risk today in investing. Also helping matters is the fact that China continues to surge forward. Many feel that the global economic recovery will be led by China, and so far the news out of China is confirming this idea. Stocks are moving higher, as are Treasury yields.

Stocks are modestly higher, since the good news is balanced by continued concerns about U.S. fundamentals and the fact that economic recovery in America is likely to be gradual. But investors are excited about the fact that consumers appear ready to start spending again. With consumer spending making up such a large portion of economic activity, it is little surprise that it is such an important consideration.

Treasury yields are also providing something attractive. Yields move inversely to prices, and prices are down, so yields — especially on 10-year bonds — are up. MarketWatch reports on the reasons behind the recent Treasury results:

Investors tend to buy Treasurys as safe places to protect principal if the economy is slowing. When the economic outlook improves, bonds lose some appeal.

With investors showing more confidence, Treasurys are not in demand. Therefore, higher yields are necessary in order entice investors. (It is also worth noting that mortgage rates are connected to 10-year Treasury bonds, so we could see an increase in mortgage rates soon.)

There are a lot of interesting investment opportunities right now, and with the end of the year approaching, time to look at the tax implications of different investments, comparing the tax advantages of bonds vs. stocks, and re-adjusting your investment plan.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.