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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: reid brandon who wrote (4186)	12/30/2003 5:27:24 PM
From: yard_man	Respond to of 110194

smart money is everyone on wall street, then?? I think not ... I shifted money to RYGBX today -- looking for a 3 handle on the TNX within 2-3 weeks >>The belief the Fed will boost rates next year is so strong on Wall Street that only one money manager of 12 at a recent dinner in New York had made that bet, one participant said. "One guy was bullish on the bond market. The rest of us were all bearish," said George Schwartz, whose Schwartz Investment Counsel Inc. advises the Ave Maria Mutual Funds. Schwartz said he was fascinated by the call because everyone says interest rates are going up and after 36 years of managing money there's one thing he's learned: "When the masses are leaning one way, you should be leaning the other way." But Schwartz said his bond portfolios hold very short maturities because all the monetary and fiscal stimulus in the economy, along with the government's heavy deficit spending, point to inflation picking up some time in the future. "That's what everybody says and everyone has invested accordingly. So a real contrarian today would be buying 30-year bonds, 30-year zero-coupon Treasuries," he said. Of course, being a contrarian isn't just opposing the consensus. That's because when (but not if) rates will go up is open to debate, the experts say. <<