I think rising European rates are a key driver of US Treasuries (its been European/Japanese flows into the US market that have supressed US yields). As US yields rise I expect rate sensitive sectors like the Nasdaq to get hurt badly. These are "Growth" stocks i.e. they do well when there is no growth . Higher yields implies higher growth. As for $ ...yes in theory a weak $ is good for tech...BUT I'm not playing a weak $. I think we have a risk-off $ bounce coming ie stocks lower and $ up

The game is on now...If you are looking at options I wouldn't bother just look at the levels we've given and trade vs those. If you want to buy options Dec 2018 50 strike puts on EEM look cheap

Steve as you know I'm a bear and I share your concern. BUT its an issue of timing. At least initially both bonds and stocks can both fall (this is the positive correlation between stock and bond PRICES not yields we've discussed). Indeed, in the Taper Tantrum in 2013, the Bund collapse on Q2 2015 and the bond sell off in 2016 correlations went positive i.e. bonds and stocks both fell in value. Yes at some point when equities have fallen enough that policy makers panic and ease then yes bonds bounce. But at least initially that isn't a risk. Frankly, the hedge initially is selling both.

Thomas I addressed this in a RV interview but I think that section was cut. Some debt will be inflated, especially government obligations. It's that simple and we have no choice. However, outside the official sector the outcome will depend on whether the entity with the debt has pricing power or not. Imagine 2 firms; Firm A and B both junk with loads of debt but very different abilities to pass on price increases. As rates rise in nominal terms (not necessarily real terms) Firm A can hike prices, thus service it's debt despite the higher cost and as the value of that debt is eroded the stock explodes higher. Firm B on the other hand, has no pricing power and as its debt servicing costs increase it defaults ...game over.

Hi Andrew yes I like European banks with a slight BUT. If rates rise too quickly as was the case in Q2 2015 and is once again a risk you have to be careful how you structure the trade. Yes banks will rise on a relative basis and outperform the broad market. BUT they could still fall overall as the overall index is hit by rising yields.