TLT--the long ride might be over

Have been in this over much of the last 3+ years. Sold it all yesterday. Thanks, Janet.

 

It's the only yield left in the world and it's probably going lower...a lot lower...the highs are not in yet for TLT. The final move will be spectacular.

 

Well, great! I'll be there for it, with bells on. My signal is telling me to get out now, but I wouldn't be surprised if that changes again. Do you think falling rates will trigger another round of careless lending?

 

Historically, long bond price has gained in 3rd quarters ( entries on 1st Monday after July 4th ) of high risk years * . This year, the configuration suggests an entry on Monday July 11, exit on October 3rd.
* quantitative price based variable # 2 & #3 https://stockmarketmap.wordpress.co...allocation-using-low-expense-index-etfs-2015/
Last allocation July 2014 https://stockmarketmap.wordpress.com/2014/07/08/market-map-allocates-to-long-bond/




- Don't quit your day job
- Don't use leverage
- Open a Roth IRA
- Sometimes money is made by sitting in cash
- Don't be a hostage to the markets
- let the markets, profitability of the U.S. economy work for you

 

Stockmarketmap, I like your set of maxims. Hope people on this site will benefit from them.

 

Credit is already tightening. This is not about lending but the value of liquidity. If you think of liquidity as an embedded option then the value of that option is increasing in value thereby driving price higher and yields lower. If anything, lending rates will rise while treasuries yields fall. At some point deflation could potentially accelerate hard to the downside driving even risky high yields to zero.

 

Makes sense. How can one tell if we are heading for deflation, versus old-fashioned recession?

 

If 30 year bond yields were ever allowed to return to non-bubble levels, they'd lose half their value and all the banks would go bankrupt. So Yellen will print her way out of that.

 

Allowed? The Fed is not buying long duration paper right now but everyone else in the world is. You think the world would not bend over backwards to brag 30 yr govies if they got back above 3% again? Come on. There is no yield in the world right now. Buying long dated US paper not only gets you yield and liquidity but also long dollars. You guys really need to take the tin foil hat off to get some air every now and again.

 

For those interested this may help with Mav's points. I wouldn't expect bond prices to descend anytime soon.

http://www.zerohedge.com/news/2016-...the+survival+rate+for+everyone+drops+to+zero)