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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: mishedlo who wrote (63681)6/14/2006 1:22:51 PM
From: Mike Johnston  Read Replies (3) of 110194
 
Treasuries have been universally despised in the face of a strong bull market. Is that how bull markets end?
If and when we see panic buying of treasuries and everyone loving them, that will be the clue.

We had a bull market in bonds that started in 1982, then in 2003 we had a buying panic that pushed the yields down to 3%.
At that time everyone was bulish and there were million reasons to buy bonds:
-we are entering deflation
-the Fed will peg long rates
-interest rates are going to 0
-the Fed will buy bonds
-the Asians are buying
-carry trade

IMO that was the top, and for now it still is.
At 20 years old this bond bull market was very old in 2003.
20 years of declining rates should be enough to turn everybody bullish on bonds.
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