Tuesday, September 16, 2008

Bond Bubble Update - yeah, another one


(photo by Kimmo Lahti)


record high for the 30 Year Bond price today. then a big reversal. another look at the point & figure chart of the yield:



the chart is giving a price objective of almost 3%, which is the figure I threw out in my previous post on the matter.

Sunday Evening I wrote:

the Bond Market may be forcing the Company Store's hand here. Bond Futures are obviously trading characteristic of a Bubble now and I don't see how this can be resolved except through a parabolic blow-off top in prices across the length of the yield curve.


well, the Company Store didn't bite. not today anyway. I understand they don't have many bullets left, but gosh, if this wasn't a pressing enough occasion to pull the trigger, then they must be fearing even bigger panics to come.

however, bond prices have certainly seen something of a blow-off, but was this the blow-off?

I Doubt It.

this looks like a good time for the market to consolidate before a push to record levels for every maturity. google 'bond bubble' and you'll find hardly anything. this just hasn't hit the Collective Imagination yet.