The counter point to that is that the Fed is a lot more aggressive than the ECB and BOJ. They will start up the printing presses again if inflation doesn't pick up and/or NGDP continues to fall
Not saying UST bonds wont go higher, they very well could. But the spread over bunds, JGBs are far as I know is actually quite high now. So on a relative basis they are not doing as well, for a reason. And that reason has to do with the belief that the Fed will do a better job to anchor inflation and NGDP. If one wants to bet in the apocalipse scenario, they are better off going directly to the source of the apocalipse, bunds and JGBs rather than use a proxy Its hard to see they going much higher unless bunds and JGBs rally a lot
Especially when you consider that the USD is now not only the highest yielding currency in the world but also the safest!
So...you're saying treasuries are a good bet for the short term...what about the longer term (1-5 yrs.)? Personally, I think treasuries are dangerous in the long run...too much debt =dollar crisis!
Long term? This is a trading site not a ROTH IRA message board. LOL. When the facts change, you can sell your treasuries. They are after all THE MOST LIQUID INSTRUMENT in the world. Personally I think treasuries will be a good trade for next 1 to 3 years. Probably due for a pullback here but I would buy any meaningful dips. Too much debt does NOT mean a dollar crisis. There is no such thing as dollars. Dollars over what? You guys keep forgetting their is a denominator in that equation. Almost ALL the G10 have mountains of debt so it's relative. The US is far better off then a lot of other nations so you can't simply say there will be a dollar crisis because of too much US debt. The real risk in the world right now is not a falling dollar but a rising one. That is the trade very few countries are prepared for.
I agree with you to a large degree. The USD is appreciating and with negative interest rates everywhere else we have bonds that look attractive with relatively higher yield compared to negative yield
There's plenty of yield in the world, but risk-free yield is vanishing because there is an overabundance of passive pussies parking all their money in return-free risk assets like 10 and 30 year government bonds.
Of course this is a trading site, a trading site with investment discussions as well...this thread is about the "LONG RIDE" of TLT. I trade futures (30 yr.) every day, but hold investments as well...precious metals and agricultural commodities. I'd rather own the metals than hold treasuries while in bubble mode. Commodities have at least some value after getting decimated the last few years. As debt continues skyrocketing here in the U.S., is there ever going to be a risk of default? What would happen to the dollar if that happened? If default never becomes an issue, it's because we keep going into more debt! Eventually the people are going to lose faith in this scheme...that will hurt the dollar. Sure, a rising dollar would be a risk for the world, but a few months ago I mentioned a hidden bubble no one talks about...the most one sided trade right now is the anti inflation trade...bonds, dollars, equities.