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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Terrapin who wrote (2827)	12/20/1997 11:21:00 AM
From: Michael Burry	Read Replies (1) \| Respond to of 78744

The conclusion was that real rates were high and would be coming down early next year. That's what I was saying : Wouldn't that mean real rates are higher than they were earlier this year despite the fall in the long bond? The important point is not that real rates are coming down, but that they have jumped due to recent disinflation, so we are actually higher now. Thus, a fall in real rates is necessary just to get back to where we were the last few years, and hence we do not and will not have ultra-low real rates to stimulate the market. In my last post, when I said that we would get no change or even an increase in real rates I meant in the present and near future, since nominal rates have not yet caught up. I was wondering why Jefferey was using capitals, since I agree with him on a nominal basis. To read Graham, value investors must always be comparing stocks to bonds, as they are in direct competition. All I can think of are long-term Treasuries or zeroes - does anyone else have any suggestions on how to play bonds/move funds into bonds if one feels stocks are too pricey relative to bonds? Mike