A 3-month chart says interest-rates are rolling over. http://finance.yahoo.com/echarts?s=^TNX+Interactive#symbol=^...A 1-year chart says that higher lows are still be made, meaning, a bottom was put in last July. http://finance.yahoo.com/echarts?s=^TNX+Interactive#symbol=^...That conclusion is confirmed by a 5-year chart. http://finance.yahoo.com/echarts?s=^TNX+Interactive#symbol=^...But a chart that looks back further, say to the early ‘60s, says that interest-rates are putting in new lows, and there’s no reason they can’t (or won’t) go still lower. http://finance.yahoo.com/echarts?s=^TNX+Interactive#symbol=^...My bet is that two contradictory things are happening. Interest-rates are going higher, and they are going lower, depending on your time-frame and on your view of the fundamentals driving both of those moves. Ultimately, investors will tire of accepting negative rates of return and/or the world’s central banks will run out of paper and ink (or else be lynched for destroying the purchasing-power of the currencies they are currently debauching). But meanwhile, the interest-rate prediction game has become even more impossible than it normally is. This isn't to say that there isn't still money to be made in the bond market. But bets on (or about) the level/direction of interest-rates should be made with caution or avoided entirely in favor of creditworthiness bets, of which there are still some viable ones, and I'm still putting money to work, because that's what a bond-investor does. He/she shops and buys regardless of market conditions. He/she doesn't (and can't) put as much money to work as when prices/conditions are more favorable. But a seat is kept at the table, and the debt game is played with as much seriousness as ever, because that's what a bond-investor does. He/she makes bets, and those bets can be of either (or both) of two forms. Interest-rate bets have become a trading gig. But classic, Ben Graham-style value investing can still be done in the bond market, and the returns aren't insignificant. Charlie---------------"He that cannot abide a bad market deserves not a good one." (an old English proverb, unattributed.)
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