re: "i have no idea what the trigger (for a bond rally) will be, but i suspect it could be a string of weaker-than-expected economic data."
Evidence of weak economic data could only be if consumer spending slows. No evidence of that, in fact, all recent evidence shows that consumers still have the throttle open all the way. If consumer confidence is at a record high, and everyone is employed, and stock prices (and housing prices) are going up, then you are going to have to wait for the 6th Fed rate hike to see weak economic data. Certainly, 3 hikes over 6 month's time hasn't slowed anything down.
But you might be right about a bond rally, or at least a temporary 0.4%-size dip in long bond rates, like we saw in 1999. Remember the 6.4 to 6.0 (and then back again) bond rally? We may have a 6.9 to 6.5 (and back again) bond rally in 2000. Maybe the trigger will be the next Fed rate hike. I know everyone is expecting it, but it may be an excuse to say, "the Fed (now) has any potential inflation well under conrol, they are on top of it (now), so we can forget about it (for now)."
Good posts, BTW. |
