Posted To: MBS Commentary
It seems that money managers and financial journalists will not relent in their calls for US bond yields to have reached a long-term floor this summer and to now be in the process of moving inevitably higher. That’s a fear that’s much easier to have when bonds have been moving steadily higher for nearly 3 months now. In fact, I can empathize. I’d like to think that my outlook on bonds is completely unbiased at any point in time, but I often ask myself “am I feeling bullish simply because rates have been falling” and “am I defensive simply because rates have been moving higher?” These are natural tendencies, and we should keep them in mind any time we hear someone claiming rates have to go higher in the weeks following a long-term low. In other words, yes… it’s…(read more)