Amid all the challenges facing the markets — Greece, Facebook, JPMorgan — investors face an even larger potential problem: They soon could be running out of traditional safe havens for their money.
Much has been made recently of how gold no longer offers its traditional buffer against financial turmoil, with the yellow metal in a sharp pullback since early March.
But some strategists are beginning to worry that other places where investors are stowing their money — high-grade bonds, Treasurys and defensive stocks in particular — also could be losing their protective shields.
"The problem is we're seeing safe-haven flows with shrinking instruments into which you can run," says Kim Rupert, managing director of global fixed income analysis at Action Economics in San Francisco. "Once the run for the exits gets started it's going to be an absolute stampede."
The search for safety comes as markets are in daily tumult over the debt crisis in Greece and its reverberations through Europe. The Facebook initial public offering had been viewed by some as a potential market turning point but has failed to live up to its billing. And JPMorgan Chase has struck another blow at investor confidence with the fallout from its $2 billion trading loss due to the so-called London Whale.Page 1 of 6 | Next Page