Vi,
That's a wonderful question, and here's why for
several reasons:
You just said it... the bonds topped out when AG
eased, they bottomed when he raised..... what we
have here is a classic example of how the markets
anticipate fundamental changes... by the time AG
lowered rates, it was already factored into the
market... it had no other place to go but
lower..... now, we have the reverse, AG's up tick
in rates signals, to me anyhow, that the bonds have
very probably bottomed.....
Also, look at what happened today through the eyes
of bond investors, step inside their heads... the
bond investors are pleased that AG raised rates
today, because this is a pre-emptive strike against
inflation, the greatest enemy of bond holders, and
all long term equity investors for that matter.....
the rate hike today is preferable rather than a
series of bigger hikes down the road after
inflation takes real hold and puts it's death grip
on these markets..... the rate hike today is
bullish for all the markets, which is why they
rallied with very good breadth.....
GZ |
