MARKET WATCH / BATTLE FOR WORLD - November 20, 2018: The article highlights that ‘From a markets perspective, it’s going to be interesting. There probably will be some really scary moments in corporate credit,’ said Paul Tudor Jones, a hedge-fund luminary.

He’s stress-testing his portfolio of corporate debt because he expects a tumultuous road ahead on the back of the Federal Reserve’s apparent commitment to normalizing interest rates and buttressed by corporate tax cuts from the Trump administration.

Speaking at an economic forum in Greenwich, Conn., a stronghold for hedge funds, Jones commented that the Fed faces real challenges amid “the end of a 10-year run” of economic growth that many anticipate will soon come to a screeching, cyclical end.

And he’s not alone, as the biggest threat to financial stability comes from the elevated level of the stock market and the sensitivity of bond prices to interest rates, says the conclusion of the Treasury Department’s Office of Financial Research, which on Thursday (November 15) published its annual report to Congress. It called the overall threat to financial stability as “medium.”

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