Historic sell-off in bonds

The five stages of grief are denial, anger, bargaining, depression and acceptance. For investors, the five stages of a bear market appear broadly similar.

Looking at data stretching as far back as 1790 (not a typo — banks just love super long-term data for moments like these), BofA describes this as the third Great Bond Bear Market. We have seen nothing like it since at least the Marshall Plan in 1949, wrote Michael Hartnett and colleagues at the bank. 

Famed investor Stanley Druckenmiller, once second-in-command to George Soros at the Quantum Fund, sounds further along in the process than many others. “I’ve had a bearish bias for 45 years. I like darkness,” 

“There’s a high probability that the market at best is going to be flat for 10 years.”

If he is right, that is potentially bad news for people whose job it is to try to write interesting things about markets on a weekly basis for national newspapers, for example. It will also require a reset of expectations among investors of all types. 

Katie Martin FT 24 September 2022

https://www.ft.com/content/3b347f19-3735-4a8d-bee3-cbc589b202c5

The Great Moderation is dead

Ajay Rajadhyaksha, a rates strategist at Barclays. “Financial markets are very good at making analysts feel foolish, and that’s especially been true in 2022.”

More than half of Nasdaq stocks have dropped 50 per cent or more from their 12-month rolling highs.

Katie Martin FT 15 July 2022

https://englundmacro.blogspot.com/2022/07/the-great-moderation-is-dead.html