No. of Recommendations: 1
I'd be wary of taking contrarian positions WRT bonds. In equities, nobody HAS to buy stock (aside from index funds). In contrast, there are an awful lot of financial institutions that pretty much have to buy bonds (or fairly similar stuff like mortgages, etc.). I'm thinking particularly of insurance coompanies, pension funds, etc. These entities are managing huge amounts of funds and can easily prop up a bond market even when it is pretty clear that what goes up must come down. Furthermore, they don't really care if their long bods go into the crapper because the value of their liabilities will also decline (assuming that they are being good about duration matching, etc.).
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.