So far it looks like we've done 5 waves up from the lows, and have/are correcting that advance. Anybody bullish on Bonds?
Surdo, It does look interesting. Even the advance off the recent lows looks to be five waves, with a completed abc correction friday.
Might FED be done ratcheting rates with Greenspans last open market committee meeting, end of January? Bonds have started moving up, the Dollar is stalling at 92, and Crude is still languishing. Might be time?
Sure. More lenders than borrowers. I don't say this in jest. IMO the surprise trade is the inability of pension systems to price in those needed higher yields. It's not so much that these funds are just under funded rather they're under performing. Why? Because their treasurer's (like many investors) took for granted that the long end of the curve would always be a few hundred bps. over fed funds and that 6-8% fixed income returns were assumptive. Too many times folks focus on the effects of how higher rates negatively effect borrowers while ignoring how low rates crush those who are dependant on pre-determined return. For now I think any back up in bond prices will be met by an avalanche of buyers who NEED bonds.
Interesting point. With the demise of the 30 year Bond, things certainly have changed. But I understand they are bringing it back in limited supply again. Do you think the Bond market will need to go through another adjustment?
why would anyone buy a 4.50 10 year with nominal inflation running at 6-7% y/y...... never understood it and I never will..... I cant understand why you would accept a negative yield help me here................
They have no choice and they don't want to assume asy risk? It's the same as keeping money in CD's at 3%, most people just take what they are offered.
hhmmm... no risk? send me a check for $10,000 and in a year I'll send you a check for $9700........... you're on...........