Comments on: As Economic Growth and Inflation Escalate, U.S. Treasury Bond Yields Will Head Higher

By: Here’s Why Government Bonds Are No Longer A Safe Investment

Here’s Why Government Bonds Are No Longer A Safe Investment — Thu, 28 May 2009 10:02:18 +0000

[...] since the U.S. budget deficit is so large that supply of them will never be limited, while inflation looks likely to reappear in force, draining the value of these bonds as inflation did to the savings of my [...]

By: J.S. Barone

J.S. Barone — Sun, 10 May 2009 22:15:01 +0000

Any recovery that ensues here is going to be a very heavily, federally engineered one…one which will not allow the market to allocate where capital is best distributed but rather one where big, flawed banks still control an ever-increasing share of available capital, and they will control the winners and losers.

By: R.H. Henscheid

R.H. Henscheid — Sun, 10 May 2009 14:35:55 +0000

Thanks, Am very interested. I was under the impression that bonds are dangerous, what is the probability of loosing the money to bonds.

By: Hans Dieter Franke

Hans Dieter Franke — Thu, 07 May 2009 20:10:00 +0000

Excellently timed article….just today auction of treasuries met disappointing demand thus that the coupon had to be increased…
yields increased. Bank stress test could turn out as pointless.

H.D.Franke Dr., Germany

By: Daves360

Daves360 — Thu, 07 May 2009 16:31:21 +0000

Can you please elaborate on this…"there’s going to have to be one hell of an adjustment by the U.S. housing market, the stock market and the U.S. economy in general." ??

By: david fleishman

david fleishman — Thu, 07 May 2009 15:58:26 +0000

I hope this prediction is not right, but it is a well laid-out argument. I second the questions from Gary above, and add the natural follow on, what should we be invested in now and in the intermediate term in anticipation of higher rates? Gold? Commodities? Or just plain old cash?

By: Dewey Lane

Dewey Lane — Thu, 07 May 2009 15:53:16 +0000

I thought increased buying of anything (treasuries by the Fed) would push prices higher. This should put downward pressure on returns/interest rate. What am I missing in above article concluding that long bond rates are going UP as demand for bonds by Fed increases? Isn't the upward driver of interest rates primarily the SELLING of bonds as investors move $$ back into the equity market?

By: Gary Reid

Gary Reid — Thu, 07 May 2009 15:07:37 +0000

I agree that inflation is coming, but when? 2009? 2010? 20011? What advance indicators should we look for, so we can prepare accordingly?

By: Ray Scalabrino

Ray Scalabrino — Thu, 07 May 2009 14:22:40 +0000

Excellent article