A Pause in Euphoria--4/17/2013

The 1st quarter of 2013 saw a stunning appreciation in the S&P 500, and most other stock markets.  However, as we enter the 2nd quarter the markets seem to be sounding a cautious tone.  Yields on Treasuries have come down, signifying buying of these "risk-free" instruments.  Meanwhile, gains in stocks have been on hold and commodities have been selling off.  

Frankly, I don't see this behavior as anything unnatural.  Investment trends don't move in perfectly straight lines and volatility is inherent in markets.  Nevertheless, defense might be the best offense in the short-term.  Time will tell.