More Turmoil for Markets

Source: http://www.flickr.com/photos/medilldc/

Federal Reserve Chairman Ben Bernanke recently announced that the Fed Reserve might soon scale back its stimulus plan for the economy. Investors were definitely listening because the effects were soon seen.

Pretty quickly, a sell-off in bonds, commodities, and stocks occurred, which signaled a new period of turmoil. This was a drastic change from the calm since the Fed had started its newest bond-buying program last fall.

A focus point of the turmoil that Bernanke’s remarks set off is the bond market. The Fed easing had driven benchmark yields to record lows, but they have already surged to two-year highs and are likely to climb higher.