Credit markets remain bolted to a narrow range, and although stocks have burbled upward there is little action there, either — low volatility everywhere.One theory holds that markets don’t care about the peculiar onset of the Trump administration, the Trump Rally holding, and the economy doing pretty well, upshifting last summer close to 2.5 percent annual GDP (gross domestic product) trend.Here a brief review of bond-market responses to typical and current events, the political inseparable from the economic.Our most basic knee-jerk: If economic news is hot, we sell bonds and rates rise. Heat implies future inflation and punishment by the Fed.If news of cooling, the reverse.The first rule of political news: Bond traders as a group assume that all politicians are useless, so partisanship is not involved. From there a hierarchy of events, beginning with the most serious: war. In the event of armed conflict, buy bonds!There is nothing big to worry about on t…
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