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2022-01-10

Why Godot Is About to Arrive

The narrative of surging 10-year yields signaling a major crash gets told again and again. 

One day, it might even happen.

Alan Greenspan said back in 2005 that the failure of long yields to rise was a “conundrum.” 

A big spike in 10-year yields has been the single biggest fear of asset allocators for two decades, and for one reason or another it never happens.

Lucy never lets Charlie Brown kick the ball, and Godot never arrives. 

In the same way, we never see the decisive move upward in bond yields that brings down the edifice of modern finance based on cheap money. The more that people like me warn that it could happen, the more it ends up not happening. 

It’s not difficult to keep inflation down when a significant segment of the workforce can be dragooned into taking minimal wage raises for a decade. If that paradigm is finally shifting, then the possibility of higher inflation, and higher yields to deal with it is very much alive

John Authers Bloomberg 10 januari 2022 

https://www.bloomberg.com/opinion/articles/2022-01-10/up-next-on-10-year-treasury-yields-it-s-either-the-red-sox-or-godot


Conundrum

https://www.internetional.se/conundrum.html



Worst Week for the 30-Year Long Bond in 49 Years

The long-bond lost 9.35%!! 

The 10-year note finished it worst week in 42 years, with a total return loss of 4.24%. 

Mish 10 January 2022

https://mishtalk.com/economics/worst-week-for-the-30-year-long-bond-in-49-years



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