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A Question Of When, Not If, Bond Prices Will Fall

Monday, April 29, 2013 - 8:38 AM
By almost any measure, the bull market that bonds have enjoyed over the past 30 years is pretty much over.

As interest rates start to rise sometime in the next few years, bond prices will undoubtedly fall.

How far, and how fast, they'll decline will mostly depend on how soon and how quickly the Federal Reserve allows interest rates to move up.

A question of when, not if, bond prices will fall |
ShorebreakShorebreak2,683 posts since
Apr 6, 2010
Rep Points: 14,546
1. Monday, April 29, 2013 - 9:21 AM
The issue is nobody knows when the interest rate will move back up; most likely it will stay low for an indefinite length of time.  Fed. is certainly in no hurry to increase rate as long as unemployment is on the high side.  Also as we discussed days ago, there is political push for the rate to stay low to creat a false image of normal economy. 

In sum, I do not expect the rate to go up in the next 2-3 years.  The fact that it cannot go lower does not justify the rate to go up any time soon.

51hh51hh1,476 posts since
Jan 16, 2010
Rep Points: 6,427