This page has been archived and commenting is disabled.
Guest Post: 5 Reasons Why Now Is The Time To Buy Bonds
Submitted by Lance Roberts of Street Talk Live blog,
The recent one month spike in interest rates, along with the mind numbing chatter about the end of the "bond bull market," has sent investors scurrying from from the bond market right into the waiting arms of a stock market correction. Besides being suckered into stocks at the market peak; individuals continue to overlook the significance of fixed income to an overall, long term, portfolio allocation model. Fixed income reduces portfolio volatility, protects principal (bonds mature at face value) and generates an income stream that contributes to portfolio performance. The most important reason to own a bond is that when it is purchased the exact rate of return can be immediately calculated to maturity. This rate of return can be very efficiently modeled into the expected rate of return a portfolio should generate over time. This is absolutely something that can not be done with a portfolio of other investments that are subject to the volatility of the stock market.
However, the recent spike in interest rates has certainly caught everyone's attention and begs the question is whether the 30-year bond bull market has indeed seen its inevitable end. The following is 5 reasons why I do not think this is the case and, from a portfolio management perspective, I believe this is a prime opportunity to increase fixed income holdings in portfolios.
International Intrigue
Money hides in U.S. Treasuries for safety when global risks are rising. As I discussed recently in "Is The Euro-zone Crisis Set To Flare Up?" there are currently many promises that have been made to the financial system by the ECB. The question is whether or not they can ultimately "cash the check." I said then that:
"While I do not have certain answers as to the where, the who or the when - I am fairly confident that it will be sooner than we currently imagine."
With yields spiking in the Euro-zone, China showing cracks on its financial front and Greece funding being threatened by the IMF it is likely that we will begin to see a rotation of excess reserves and investment dollars back into the "safe haven" of U.S. bonds to reduce default risks.
Economic Weakness
Another positive for U.S. bonds, which coincides with the international front, is domestic economic weakness. Weaker economic growth will weigh on the stock market as earnings growth continues to deteriorate which, in turn, will likely make the relative safety of bonds much more attractive. Despite much commentary to the contrary history shows that interest rates tend to follow the strength, or weakness of the broad economy. The chart below shows the annual rate of change for 10-year treasury rates and real GDP.
Dis-Inflation
While the Fed currently has a target of 2% on inflation, so does Japan, it doesn't mean that the have any real control over inflationary pressures in the market. Inflation is ultimately a function of economic activity, employment and production and wages. As I discussed just recently in "Deflation: The Fed's Real Worry" the Fed's biggest fear is the negative economic impact of deflation. The headwinds facing the economy currently are structural in nature and are not something that continued rounds of liquidity injections have been able to fix.
As shown in the chart above interest rates tend to follow inflation. While interest rates have spiked in the last month, a move that has the Fed "more than a little baffled", the decline in both current inflation, as well as future expectations, will likely keep a lid on interest rates through the remainder of this year.
Political Showdowns
Coming soon to a "kabuki" theater near you will be the second annual revival of the "debt ceiling debate." While I am not suggesting that we will have an exact repeat of the 2011 debacle - it is quite likely that IF the threat of "debt default" begins to surface, once again, interest rates will fall as money seeks a "safe haven" against political turmoil. The chart below shows what happened to interest rates in the summer of 2011.
The recent surge, while it has been quite dramatic, has only returned interest rates back to where they were just two short years ago. With the debt ceiling debate once again looming, the Euro-crisis simmering, Japan faltering and China showing cracks in their financial armor there is only one real place left for the world to store their excess reserves in "safety."
Technically Opportunistic
Lastly, despite all of the other commentary and rhetoric in the market as of the last month, interest rates are pushing extreme overbought levels. The chart below shows a weekly chart of interest as compared to its long term moving average. Currently, at more than 3-standard deviations overbought, the level of interest rates is unsustainable and a correction is in order. In the chart I have noted (vertical blue lines) every time that the 10-year interest rate has touched 3-standard deviations above the long term mean. In every single case, over the last 10-years, that was the absolute peak of the move higher. It is unlikely to be "different this time."
With a downside target of 1.8% currently, which is simply a retracement to the mean, there is a fairly low risk entry point for bonds at the current time. Furthermore, if the recent market "sell signal" is validated it is likely that interest rates could fall as low as 1.5%.
Bonds Look Cheap
For all of these reasons I am bullish on the bond market through the end of this year. Furthermore, with market volatility rising, economic weakness creeping in and plenty of catalysts to send stocks lower - bonds will continue to hedge long only portfolios against meaningful market declines while providing an income stream.
Will the "bond bull" market eventually come to an end? Yes, it will, eventually. However, the catalysts needed to create the type of economic growth required to drive interest rates substantially higher, as we saw previous to the 1980's, are simply not available currently. This will likely be the case for many years to come as the Fed, and the administration, come to the inevitable conclusion that we are now in a "liquidity trap" along with the bulk of developed countries. While there is certainly not a tremendous amount of downside left for interest rates to fall in the current environment - there is also not a tremendous amount of room for them to rise until they begin to negatively impact consumption, housing and investment. It is likely that we will remain trapped within the current trading range for quite a while longer as the economy continues to "muddle" along.
»
- 28631 reads
- Printer-friendly version
- Send to friend
- advertisements -
Meh, and be the last clown standing when the music stops?
Methinks Lance is just talking his book. I'd rather be 2 months early, than 2 minutes late. No thx.
Sometimes 'this time is different' really is different. Look at bonds during the Lybian crisis. Somehow the flight to safety didn't quite happen. That was the turning point. Thinkiing the old rules have to apply when a bubble pops is naive.
Any interest-based or leverage-based asset is hot potato at this point, and has been since 07. You simply do not know what the return will be, as it can fluctuate like a diabetic's sugar levels. You can only trust physical inventory anymore, whatever form it may take.
Right before a hurricane hits it gets inharmoniously calm.
But maybe sovereign bonds are like real estate? Where it's almost always a good time to buy? ;-)
I bet lance is wrong until the 30 is at 5%
Leave the Gun...take the canolis
Bonds and stocks are generally inversly correlated. The last week they were positively correlated. One has to change. Which is it going to be. Stocks or bonds? Not positive it could be bonds. Not sure that bonds are getting any lower but stocks could rebound. At least short term Long term, who knows. If the economy drops (stock drops) Bernanke is not goiong to taper. So stocks will rally. I am not sure stocks or bonds are going to drop much more. Bernanke is not going to let either one 'crash'.
Oh sure..
I second headbanger.
I didn't get past the first sentence, which was hogwash. Also, inversely was misspelled, not that I care.
I put it more simply. It is the contest of governments' ability to wreck economies (deflationary-positive bonds) versus stimulus policy from the Fed and central banks (inflationary-negative bonds).
I personally believe that governments have the greater ability to wreck economies. Europe in in recession and there is not enough money in the whole world to fund long term US and Japanese obligations.
Having said that I still own gold and silver. Governments can wreck currencies, as well.
TLT looked good for a trade at Fridays close.
I agree it did, but for a trade.
I gotta be honest, something seems weird. There have been many articles on here from guests and the authors pounding the table on bonds, starting about 40 basis points ago. It would be unfortunate if the same crowd that spent years understandably missing the equity rally were to walk into an asswhooping buying into the possible unwind of the largest bubble out there.
Yep! And while I understand ZH is a "financial" blog but wasn't it created out of protest with the existing system. I've found it strange that ZH has moreso lately been endorsing it. Just sayin...
You aren't the only one that noticed it.
Money has pull. Paid writer gets spotlight for a few fiatskis. Why the hell do you think you keep seeing GS articles?
Several years ago, one interesting factoid about ZeroHedge was where the site's traffic originated. Sure, there was New York and elsewhere, but a grossly disproportionate amount came from Herndon, Virginia, which is ground zero for just about all U.S. intelligence operations. Another thing that was obvious was that many of the people posting on this (then) blog were talking about things that nobody (and I mean nobody) else was in a remarkably casual, knowledgeable, and professional manner.
My conclusion was that ZeroHedge was at the time some kind of publically accessible forum where a bunch of financial spooks got together and openly talked shop.
It was very weird and just a little scarey. Kinda like that forum where Ezra Kahn (?) and a couple thousand other 'journalists' all got together and coordinated stories and spin (aka "lies").
It's changed quite a bit over the years, even before the most recent assault on anything goes.
Please let us know how you're privy to the IP addresses of ZH contributors, will you? Is there a site besides nsa.mil that records them? :)
What I wrote was from information in an article on this very website (which was a mere blog at the time), which, if I recall correctly, was based on statistics from Alexis or some such.
Look, when you or I or anyone else comes to this site, our client computer browser makes an http request to this website's server. In order for this website's server to answer that request, it needs to know where to send the packets of information that our computer's browser fashions into what we see on the screen. In this context, the *where* to send packets is defined by 'ip addresses'; that is, the ubiquitous 123.456.789.012 numbers that even most casual computer users have seen.
Those ip addresses, in turn, are generally and loosely associated with geographical areas because that is (was?) the way ICAHN and others assigned them.
So, in short, it would be no great feat for anyone seeing the ip addresss currently being used by my computer (to tell ebay, for instance, where to direct their server's response to my search for whatever) to deduce that I am in or near Sacramento, California. More than that requires (or, well, used to require) accessing more detailed logs maintained by one's isp. These days, .GUV probably gets them even before our isp does, but, oh, well.
This of course, is why real hardcore security and privacy types advocate TOR and other techniques to conceal one's ip address from, e.g., ZeroHedge or any other website. In fact, there was, and may still be, some advice on this site about how to conceal one's actual ip address from this website or others.
I am not privy to anything not equally available to all. Maybe a little more knowledgeable, and even that's debatable. Bottom line is that what I wrote is a paraphrase of something that I read on this site several years ago before it changed.
dupe
and sometimes people wake up with Horseheads in their bed...... E.G. Rupport Murdoch....
Gotta beat the bastarooni's at their own game.
Even Robert Prechter is screaming get out of all bonds. But anything can get stretched. Let's make some money for the good guys.
Do you remember, i think it was Leo something, pumping Greek bonds on here before the default?
Chinese solars.
A little TLT profit next week will get a good price on the "Great Rotation" into Silver.
We are all just renting at this point.
All those things are largely true.
They are very possibly trumped by the loss of the biggest bid establishing a floor.
Because deflation is universal. Decline in price of assets, including bonds.
This. People are going to cash; this will accelerate next month. Redemption, in every sense of the word.
Sounds like the was written by someone who is long - or advising clients to be long - bonds. There's a question of risk/reward here. It looks pretty disproportionate to me.
Agree that the T bond bull is nowhere near dead but for none of those bullcrap fundamental reasons above. There is no market, there is only the bernank.
5 reasons to buy bonds??
After a 30 year bond bull, with the whole world and their dog long on bonds, sovereigns and banks leveraged and drowning in debt. You go for it.
That's not really the point.
The point is relentless, grinding decline in GDP growth rates, and economic activity in general. It's been going on for a very long time and there is zero evidence that has changed.
Bond yields have fallen globally because there's no growth. If that hasn't changed, why would there be any sea change for bonds?
If I could have put all my money into a 30 year T-Bill at 15% in 1977, wouldn't I have been a lot better off than the stock market?
At this point, why would I want to play the FED's game and jump on the yield/% rate Yo-Yo?
And, isn't buying bonds a way of supporting the FED?
The fuck? ZeroHedge tells me to buy bonds?
and it ain't the first time in recent weeks.
I'm not sure when we went from the only winning move is not to play to catch the hot potato.
Gotta pay the bills, I guess.
Usually postings of this type fall under "guest" articles at least.
I don't recall seeing the Tylers advocating such an investment vehicle. When and if you do........then it's probably best to find an alternative to ZH. Because that will mean the credits are rolling and it's time to leave the theater.
I am not sure by posting articles by others (wherever palced) is the same as suggesting one participate in the message. In addition, I have always thought that it was common knowledge by ZH'rs that only a fool would come to any website or blog for investment advice. However, it is interesting to see how commentators react to various articles. Do you guys still read one star rated articles?
@Fonz....I enjoy the exchange you have with several folks . Keep up the good work.
thanks for that.
EK, I said the same thing above in Fonz's post. I've been noticing a change in the site. Makes me wonder if it's under new management or edict.
If I wanted to be told to buy bonds, I'd be on Marketwatch.
Seriously, WTF. I'm on this site specifically because it goes against the grain. If that were to change then why the fuck would I waste my time here, as there are plenty of sites sucking Bernankes cock.
At least they make it clear. Unlike marketwatch which is just full of shit.
"You should assume that at all times we are so totally just talking our book it would shock and awe you like the unexpected, early-morning arrival of a cluster of BGM-109C Tomahawks (were you a believer in the importance of "optics" that is).
If we make a off-hand remark about New Zealand sheep herders it's because we are long New Zealand West Island Cold Kut (NZ-WICK) Wool futures and Kiwi brand Condoms ("For it's pleasure"). If we are joking around about Cliff Asness, it's because we have developed a synthetic short of ARQ. If we jest about Joe Sixpack, it's because we are trying to hype our cheap-American-beer holdings so we can exit quickly. Basically, we are telling you about a position we believe in strongly enough to invest in.
......
http://www.zerohedge.com/node/13972
Marketwatch is still telling people to get into stocks and out of bonds though.
If you just want to hear "buy physical" and "this is the last time they can take it down, really really this time" well, yeah ... there are probably better sites for that.
marketwatch is part of the CIA/MSM psyops owned by rupert murdoch.......dont waste ur time......
I never said I subscribed to the belief either way. I use ZH to counter out the koolaid sites like MW.
Both are to be taken with a grain of salt, of varying size.
I hear you. was not implying anything other than the thought that at least zh is upfront with their polocies.
True... but I still never realised going here meant being pushed bonds.
Time to adjust the bias filter.
Hahaha, with MW you'd have to hit me with the bottle of salt. That place is so full of shit the banner should be brown instead of green.
Are you reading this for an article or a deity? If this site was always opposite of the consensus, it would be useless. Just do your own due diligence.
EscapeKey "Seriously, WTF. I'm on this site specifically because it goes against the grain."
If you depend on the opinion of others, you are never against the grain.
The Hedge isn't telling you anything. Just because a guest posts an article it doesn't mean the Hedge endorses it.
I've seen a few by the Authors Doc. Just calling it like I see it.
That being said the hedge makes it clear they can say one thing while they do another.
EscapeKey "The fuck? ZeroHedge tells me to buy bonds?"
Comment:
Where is ZH telling you to do anything? TD provides his own incites and also presents the thoughts of other authors. Are unable to think for yourself? Okay, I'm an ass for asking that question. The answer is yes because of your post unless it was sarcastic (missing the (sarc) tag.
Here's a short read. BIS tells central banks to head for the exits | ForexLive
I think that bonds are going back up in price. Bernanke is trying to get some sort of guage as to what will be the result if he starts tapering. If bond yields don't go back down appreciably, he'll never taper. I still think the equity markets have more downside to come, but it won't be in a straight line.
I agree Yen. This is going to be choppy. The next move seems to be up in price for bonds and down in equities. However from what I hear, the trend is actually higher in yields as time goes on. I am amazed to hear that. I guess we will see.
Earnings starts July 8th, for Q-2 Fonz. That should stir up some dust.
I see some folks talking about keeping their holdings in cash, so keeping an eye on the DXY will be important. It's pretty overbought again s/t. Everyone keeps talking about this strong dollar trade.( I don't see any bad reason to stay liquid and wait for direction) Personally, I think the dollar trade is going to be range bound over the next 2-4 weeks.
I think what is being underestimated is the reaction the 1st week of July when the 401(k) crowd gets those statements and sees their stocks and bonds whacked. If I had to take a guess, and it's just a guess, the overall trend, being choppy, is for a higher USD and lower bond prices.
My only caveat would be if rates move up even 10bps from here in a disorderly fashion. Then all bets are off.
Thinking the same. A good bet that bond prices will stay mostly down through quarters end.
WTF, I've been selling my bond holdings. Now I gotta buy em back? Screw this, I want a government subsidy.
um, nice thesis.....that forgets one pivotal factor......
complete and total loss of confidence in the US and Mr. Bernanke.
anyone holding US bonds now is on a suicide mission.
Yup, I agree with that, suicide mission. But, I do think they will mellow for a while before moving to new lows. Too much to soon. But the last investment I want in my portfolio is bonds. When they do crash you can lose a years worth of interest in 1 week. And these markets are not free. No bonds for me.
I think you're correct about the eventual outcome, but it's a ways off yet.
I'm guessing the recent move in bonds was a selloff in order to prop up the stock market (or a btfd, either way, same outcome). The fear play will absolutely begin in equities and that will tend to be bullish for bonds. When the fed starts overtly buying stocks that will probably be bearish for both markets because it means there is no liquidity/margin left anywhere.
end of the year
Yea but its more cigarettes than a shotgun.
For a lousy couple of percentage points of interest, one is better off keeping fiat dollars under the bed in view of potential bond implosion and further haircuts of both deposits and bond holders.
If you care to extrapolate any further then gold is a much more natural choice against the madness of this world.
forget paper. silver. bullion. in your hands.
Seize Mars is done with paper. No more stocks, no more bonds.
What about USD?
Kyle Bass: I'd Much Rather Own Gold Than Paper
http://www.youtube.com/watch?v=94OVi_lS2Xg (3:26)
people forget that the 30yr Bond bull started when inflation was rampant along with an overheated economy and there was real fear that it would continue ad infinitum. Today, a weak economy for years to come coupled with no fear of inflation and the argument is being made for bond investment. I think MARKET interest rates could rise dramatically even while Bernanke keeps short term interest rates low. The gulf between short term rates and long term rates could widen dramatically and the Fed will only be able to unload those bonds at a loss. Poetic justice. Cash will be king, bonds or notes are not the same as cash when there is a liquidity crisis. Today cash is the most despised asset given the Fed's propensity to print but the debt balloon is so huge it threatens to engulf everything several times over given that it has grown to this level via extreme leverage.
I have no idea how they will do it, but the Fed will not lose one thin dime on their purchases, quite the opposite.
What does his fund actually own?
Yep, just what I want to do, continue to feed the beast that's eventually going to murder us all.
stupe
See there is just no sane place to allocate capital. The pigs at the top have everything so locked up to the status quo that even when there are wonderful, smart, lucrative and eco friendly investment opportunities, they get squashed by the over-lords and or totally exploited and raped by management. Until sanity of some sort returns if that ever happens investing is just asking for financial ruin.
Playing means playing by their rules and in this rigged game... well forget it.
Free money to people that don't give a shit about anything you just said trumps actual investment in what needs, by any sane persons rationale, to be invested in.
That's the entire problem.
Sending false signals that cause egregious malinvestment.
"Inflation is ultimately a function of economic activity, employment and production and wages."
Not for any country with a high current account deficit ...
While I agree that interest rates are not going to rise, the worst mistake you can make is to buy bonds.
There are only two possibilities: either bonds default, or the currency hyperinflates. In the former scenario, you will be left with nothing. The bond simply "dies" and becomes worthless while you hold it. The latter scenario needs no explanation.
You are much better off holding short term cash for spending and physical precious metal for saving, and just waiting for the biggest shitstorm in recorded human history to pass.
“individuals continue to overlook the significance of fixed income to an overall, long term, portfolio allocation model.”
Maybe this is the “fair and balanced” way of presenting stuff,. maybe the PTB really can distort their way back to rationality, maybe if I just gulp down the whole bottle I can drink myself back to sobriety, but until now I have never projectile vomited, explosive diarrhea’d, bled out my eyeballs and ears and pee’d my pants all at very same instant.
You're missing out bro, we obviously don't go to the same one man parties.
Please don't forget that espousing such ideals is like offering yourself up to the Colosseum, that's why a community of like minded people with the ability to provide for themselves, and with like values, will trump the individual "hoarder".
Alone, and the mob will hang you and waste your life's work and lay waste to your family, stand together with people that you respect and that respect you, and you might have a chance.
Sorry for the heady proclamations, but i find the reminders necessary.
The most scarce resource is just and honest human communities.
Here's hoping the mob does'nt gain control of any of the many nuke plants in this country.
#1 reason NOT to buy bonds: Doing so contributes to the continued enslavement of mankind.
When was the last time you held a united states government bond in your hand?
Last week when I sold some of my US treasuries.
Oh pu-leeez....
Yencross: " I think you're correct about the eventual outcome, but it's a ways off yet."
Cold comfort indeed. How much $$ I lost short 2009-2013 ... {sigh}
there's a word for people who take investing advise from ZH. They are called "broke".
Information isn't advice, and if you take anyone's word for anything at face value you are bound to get yours ripped off.
This game is for survival, have fun trusting the smiling faces on your view screen.
They really enjoy that you do.
Actually most of what zh does is sardonic macro stuff. The rare times they do come out and sarcastically suggest a trade it is more often than not money good.
Sure hope the market doesn't "muddle" much longer. If it does we'll have to call it a crash.
I don't buy Lance's "interest rates are pushing extreme overbought levels". Precisely when markets start to trend the overbought does not get relieved. I like this picture better (posted link earlier on another thread), also it's a month old and so far right on the money -
http://eideticresearch.com/uploads/2/8/3/4/2834543/u.s._treasury_30-year...
The smart money is making a quiet exit for real* assets, and rebalancing select secondary or tertiary assets.
This does not exclude shares in businesses, or in time-proven companies -- with share certificates in own hand, to avoid 3rd party counter risk (Lehmanized, Corzanized).
The only 'bonds' I'd touch would be corporate bonds. But probably from select companies across the globe, not just the US.
* Mineral/Resource rights, PM, quality property (arable, rentable), select art or antiques (which I personally avoid).
Now that Japan is stabilized i would imagine the hot money would be flowing that way....
Lot of news not getting reported anymore...
What happened to the Greek Government.?
Protests in Egypt?
No Fly in Syria?
Is Japanese can really kicked?
Isnt there a fiscal cliff out there none too far?
wasnt there an Odumbo scandal or three a few weeks back?
There is 100% certainty that bonds will go up, or they wont.... hard to see a 2.5% bond if the inflation rate starts to fly....
This article is perhaps the worst I've read on ZH. It's almost as if Ben Bernanke slipped in as a guest writer and is trying to find some competitors for his bond buying expedition. Buying US sovereign debt is clearly playing with fire. Sure, you could argue money will leave other sovereign debt or stocks into government bonds and you could speculate we don't know how long we can "muddle along" but real assets are the only viable and sane option any longer, unless you just want to throw your chips into the casino and watch them all float down the river.
As interest rates rise, the value of debt instruments will collapse. If you want to wait until it matures to get your money back, your purchasing power will be incapacitated even if you retain the same nominal terms of your investment. Anybody who has the faintest understanding of the fundamentals of the world economy, but especially that of the United States, knows that we are broke beyond all capacity to repay, and there is going to be a bond crisis like never before, not just overseas but most definitely in the US. Only plausible outcome at this point is default, either by inflation or refusal to pay. It's disaster either way. So I cannot understand how anybody on ZH would ever with any semblance of sanity actively encourage buying US government bonds.
: "So I cannot understand how anybody on ZH would ever with any semblance of sanity actively encourage buying US government bonds."
It's a short term bubble. But, what a bubble it will be! Peter Schiff explains in his book that when nobody buys U.S. bonds anymore, the government will step up its bond buying (in this case, the Fed). This will create a "super bubble". Many day traders will jump in and buy bonds (making the bond bubble even bigger) and they will make a fortune. But when the bond bubble finally "pops" all Hell will break lose. That is when the game is finally over.
"Coming soon to a Kabuki theatre near you !" .... See, people do read Monedas .... although, they don't normally admit to it .... in polite company .... but when they quote my witicisms .... it's amusing ! Monedas 1929 Comedy Jihad It's Fun Being Me World Tour
I think this guy has a point .... they'll knock down these fear driven .... interest rates .... because it's imperaFUCKINGtive .... in this market of no return .... I still recommend .... being 80 to 100% in fyzz PMs .... if you have a little money to play around with .... go for it .... there is plenty of movement in PMs .... so you should be able to turn a profit there, also .... since it's your fucking field of expertise .... but so hard to do .... keep hoarding .... and as for me .... keep doing nothing .... and keep enjoying my favourite soap opera .... AS THE WORLD SQUIRMS !
Good post - thx!
The upside of buying bonds is?
The downside potential of buying bonds is?
Ben, you're spending way too much time here on ZH now that you have been told to back off the manipulation.
I don't know if now is the perfect time to reenter the bond market, but I will stand by my call of 1% on the 10Y Treasury before all is said and done.
Good time to load up on debt purchases if you want to be forced to swap it for equity. Not sure if there's a liquid market in sovereign equities... at least not yet.
Dr. Lacy Hunt has pointed out several historical instances in which the combination of a financial crisis and a large debt overhang resulted in 30-year sovereigns bottoming out in the 2% range long after the financial crisis occurred. In his research, the average time to reach this nadir was 14 years after the financial crisis! It’s funny that so many Zero Hedgers seem to be banking on a Weimar-style hyper-inflationary collapse, when the much more likely doomsday scenario is a slow, grinding, Japanese-style deflation and stagnation.
Thanks for pointing out what should be obvious.
SENTIMENT for Bonds has been extremely negative. Current sell-off doesn't seem to fit with the bond sentiment, but it does fit with the margin debt levels on equities. This could be Reason # 6. Just use (% Long + % Neutral) / (% Short + % Neutral) using JP Morgan sentiment indicators.
Could also chart % population UNDER 50 years and compare that to rates. US today is where Japan was 20 years ago. Reason # 7.
electric motor manufacturer
electric motor manufacturer
shelving racks
shelving racks
pressure transmitter
pressure transmitter
web designing company in india
web designing company in india
copper flexible
copper flexible
pest control
pest control