Twas a week before Christmas 2022 - Butler Financial, LTD
Important Tax FAQs


Twas a week before Christmas 2022

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Twas the week before Christmas, when all through Ray Jay’s house,
Inflation was stirring, recession advocates ready to espouse;
Stocks… oh they swung, giving investors a scare,
In the hopes that Chair Powell provides its’ repair;
Balance sheets were nestled all snug with few dreads,
While visions of leverage way less than the Fed’s;
And Biden in search of a soft landing map;
Midterm unsettled for a long next year scrap,

When out in the market arose such a clatter,
I sprang from my chair to see what was the matter,
Away from the highs, stocks withdrew in a flash,
Downed Treasury prices, yield levels strong, some say brash.

The afternoon on the breast of a new yield plateau,
Gave a luster and ray and fixed income glow,
When, what to my wondering eyes did appear,
But a prediction of how long Fed hikes would be here,
With a little fear on which investment to pick,
I knew in a moment duration the trick.
More rapid than eagles income to claim,
We whistled and shouted and called them by name:

Now Queen Elizabeth! now Mikhail Gorbachev! now Orrin Hatch! now Madeleine Albright!
On Vin Scully! on, Olivia Newton-John! on, Bill Russell! on, Kirstie Alley! we write,
To the memory torch! From the top they befall!
Now dash away! Dash away! Dash away all!”

As uncertainty before the turbulent data does fly,
When markets meet with munis lacking ample supply.
So plea to the house, the senate, the policies they pursue,
With a sleigh full of opinions, we hope answers come too-

And then in a twinkling, but absent foolproof,
The politicking and positioning, is it just a goof?
As I drew in my head, and was turning around,
Down the chimney Powell came with a bound.

Tightening stance to slow demand in dispute,
Stable prices, lower employment in pursuit.
A bundle of policies he had flung on his back,
And he looked like a peddler just open to attack.

This inflation – how it appeared! Keeping investors wary!
Food, gas, air, hotel, vehicle, energy prices – how scary!
Russia and Ukraine this Christmas’ black snow,
Future concerns China – Taiwan, say it ain’t so.

Oh how rates have risen, much yield to bequeath,
Individual bonds protect principal in the portfolio beneath.
This window of opportunity from the curves belly,
Helping income buyers, like a bowl full of jelly.

Should a recession ensue, rates fall short like an elf,
Now is the time, add yield & duration to the portfolio shelf.
Total return to benefit too, not instead
Income plus price appreciation… that’s what I said;

Tax loss swaps, the action a perk,
Laddered maturities mitigating reinvestment risk is how they work,
And although Treasury rates are inverted, it’s the way it goes,
Steep sloping curves for munis and corporates we propose.

I spring from my desk, to blow my portfolio whistle,
Take advantage of this window with yields up like a missile.
Fixed Income Solutions our mission, our service, taking on your fight,
But most importantly remember,

“Merry Christmas to all, and to all a good night!”

The author of this material is a Trader in the Fixed Income Department of Raymond James & Associates (RJA), and is not an Analyst. Any opinions expressed may differ from opinions expressed by other departments of RJA, including our Equity Research Department, and are subject to change without notice. The data and information contained herein was obtained from sources considered to be reliable, but RJA does not guarantee its accuracy and/or completeness. Neither the information nor any opinions expressed constitute a solicitation for the purchase or sale of any security referred to herein. This material may include analysis of sectors, securities and/or derivatives that RJA may have positions, long or short, held proprietarily. RJA or its affiliates may execute transactions which may not be consistent with the report’s conclusions. RJA may also have performed investment banking services for the issuers of such securities. Investors should discuss the risks inherent in bonds with their Raymond James Financial Advisor. Risks include, but are not limited to, changes in interest rates, liquidity, credit quality, volatility, and duration. Past performance is no assurance of future results.

Investment products are: not deposits, not FDIC/NCUA insured, not insured by any government agency, not bank guaranteed, subject to risk and may lose value.

To learn more about the risks and rewards of investing in fixed income, access the Securities Industry and Financial Markets Association’s Project Invested website and Investor Guides at, FINRA’s Investor section of, and the Municipal Securities Rulemaking Board’s (MSRB) Electronic Municipal Market Access System (EMMA) at

Other posts you might like
March highlighted by markets rising to record highs

Markets & Investing April 01, 2024 Market rally driven by a broadening of the market and optimism that...

read more
The next level of play in the financial markets

Markets & Investing April 01, 2024 Raymond James CIO Larry Adam reminds investors they need to be well...

read more
No fooling – a silver lining for investors

Markets & Investing April 01, 2024 Doug Drabik discusses fixed income market conditions and offers...

read more