T Nation

New dot.com Bubble in Treasuries

"In a blog post entitled â??Do US bonds resemble dot com stocks?â?? The author of â??Bailout Nationâ??, and CEO of quant research firm Fusion IQ, notes how the current environment for US Treasuries reminds him of the dot com stocks circa 1997-98 in three ways:

'1) You knew momentum was taking them higher;
2) You knew it was going to end badly;
3) If you were honest, you admitted you had precisely zero idea when the day of reckoning would be.â??

Commenting on the post, Ritholtz told Citywire â??the US bond market is now in the final innings of a 30 year bull market. In 1981, ten year US Treasuries hit a high of 15.32%, now theyâ??re at 2.6%â?? (as at 16/08/2010) and there is almost no room left for rates to go lower.â??

He also expressed fears over the continued attraction of US government bonds for foreign investors. â??If you look at Japan, most of the investors in Japanese government bonds are domestic. In the US, the bulk of treasury holders are foreign,’ he said. 'You have to convince them that itâ??s worth holding these bonds with a return of 2% or lower. Itâ??s a tough sell.â??

http://citywire.co.uk/global/barry-ritholtz-treasuries-resemble-dot-com-stocks/a425045

The Great Collapse is on the way.

[quote]Headhunter wrote:
"In a blog post entitled â??Do US bonds resemble dot com stocks?â?? The author of â??Bailout Nationâ??, and CEO of quant research firm Fusion IQ, notes how the current environment for US Treasuries reminds him of the dot com stocks circa 1997-98 in three ways:

'1) You knew momentum was taking them higher;
2) You knew it was going to end badly;
3) If you were honest, you admitted you had precisely zero idea when the day of reckoning would be.â??

Commenting on the post, Ritholtz told Citywire â??the US bond market is now in the final innings of a 30 year bull market. In 1981, ten year US Treasuries hit a high of 15.32%, now theyâ??re at 2.6%â?? (as at 16/08/2010) and there is almost no room left for rates to go lower.â??

He also expressed fears over the continued attraction of US government bonds for foreign investors. â??If you look at Japan, most of the investors in Japanese government bonds are domestic. In the US, the bulk of treasury holders are foreign,’ he said. 'You have to convince them that itâ??s worth holding these bonds with a return of 2% or lower. Itâ??s a tough sell.â??

The Great Collapse is on the way.[/quote]

So you sold all of your assets and bought gold right?

[quote]JoeGood wrote:

[quote]Headhunter wrote:
"In a blog post entitled �¢??Do US bonds resemble dot com stocks?�¢?? The author of �¢??Bailout Nation�¢??, and CEO of quant research firm Fusion IQ, notes how the current environment for US Treasuries reminds him of the dot com stocks circa 1997-98 in three ways:

'1) You knew momentum was taking them higher;
2) You knew it was going to end badly;
3) If you were honest, you admitted you had precisely zero idea when the day of reckoning would be.�¢??

Commenting on the post, Ritholtz told Citywire �¢??the US bond market is now in the final innings of a 30 year bull market. In 1981, ten year US Treasuries hit a high of 15.32%, now they�¢??re at 2.6%�¢?? (as at 16/08/2010) and there is almost no room left for rates to go lower.�¢??

He also expressed fears over the continued attraction of US government bonds for foreign investors. Ã?¢??If you look at Japan, most of the investors in Japanese government bonds are domestic. In the US, the bulk of treasury holders are foreign,’ he said. 'You have to convince them that itÃ?¢??s worth holding these bonds with a return of 2% or lower. ItÃ?¢??s a tough sell.Ã?¢??

The Great Collapse is on the way.[/quote]

So you sold all of your assets and bought gold right? [/quote]

No. I and my wife have about 50% of our assets in gold and mining stocks. The other half is in legacy stocks that her grandad left her.

What about guns, ammo, and non-perishable food? (Srs). If there were to be hyperinflation (would dumping treasuries cause this?) isn’t this is what you’d care about having?

My point was that people talk about how real estate is going to collapse, but they still don’t sell their homes and rent a cheap place while investing the procedes. Thats what a poster who believed what they were posting would do. People post all sorts of crazy shit on here but they don’t ever do the things that should be done if they really believed what they post.

If you believe that a Great Collapse is coming and you don’t sell everything you own and put it into hard assets, like precious metals, then you are either a) An idiot or B) You don’t really believe what you are saying.

Japanese 10 year has been under 2%, save a few months, for like 12 years and counting. There are some fundamental differences between the US and JApan, but careful being early on that call…