What we mean by “sound money”

Joe Davis: That's why we say sound money. What does that mean?

It just means the interest rates, more likely than not, will be in an environment where they will exceed the average rate of inflation, not month to month exactly, but on average. It's a positive real return for fixed income, which was not the case since the global financial crisis. Actually, since the early 2000s when half the world was on the zero bound.

And so that's why we say it's a more positive fixed income environment. That has nothing to do with what the Federal Reserve will do this year. It has to do with the average level and range of interest rates, most of which is actually not influenced at all by Federal Reserve policy. They don't determine what the long-term interest rate is.