Scenario 1: Yields continue to go lower or stagnate near term, while latent reflationary pressures in the U.S. continue to build up under the vagaries of loose monetary environment; or
Scenario 2: More likely, going into next year and beyond, rates start rising persistently as the open market speaks out to normalize rates -- that should cause treasury protection securities to rise as assets start repositioning from the very liquid US long bond & debt market into hard asset classes, particularly gold . With so many currencies around the world defending their exports through currency manipulation and/or loose regime mechanisms of epic magnitude, given that liquidity drives markets, and that the gold market is much less liquid than the bond giants, just a small repositioning out of bonds can fuel much high prices in safe haven categories.
Rising rates should benefit money-center banks, like Citi, which has a particularly attractive , flush with cash. With a more robust US growth taking shape, along with improving employment numbers, American Express also looks particularly compelling in the financial services space right now. With all the fast-changing regulatory requirements fast approaching, financial institutions will be in a race to accommodate the changes; and as a result FinTech companies should strongly benefit.