They don't make bonds like they used to
There are plenty of reasons to invest in USD-denominated assets but high yields on government bonds certainly aren't one of them.
Yields from 2 years to 30 years range from 0.147% to 1.288%. Looking at 10-year today, they're down 1 basis point to 0.6086% after falling as low as 0.5988%. At the low, today would be the lowest close since April 21.
The bond market is sending a much different picture from equities and you can argue a bunch of different reasons for that but there are two main arguments:
- The Fed is buying all the supply and signaling low rates
- There's a bi-pole market and many people think the worst is still to come
In general, betting against the bond market is a bad idea. Treasuries were signaling trouble in January and late-Feb when stocks were riding high. At the same time, I'm sympathetic to the first point because the Fed has been so aggressive.
