Bearish outlook on long-duration US Treasuries
A cyclical economic reinvigoration combined with deliberate currency debasement makes long-duration US government bonds the worst asset class to own.
The argument
The speakers argued that the secular trend of inflation and dollar debasement is highly toxic for long-term bonds. They noted that while short-term data points occasionally trigger temporary bids in bonds, the structural setup of economic reacceleration and fiscal policy makes holding long-duration government debt a losing proposition.
The thesis, stress-tested
✓ What validates it
- ✓Continued upward pressure on long-term US Treasury yields
- ✓Persistent inflationary prints despite restrictive monetary policy
▸ Risks discussed
- ▸A severe growth scare or deflationary shock could trigger a flight to safety in Treasuries
- ▸New trade tariffs or geopolitical escalations that act as a deflationary tax
Hear it yourself
"Well, Felix, the the worst performing asset on that chart you showed on that bar chart was TLT government bonds. And that's actually an area I'm becoming increasingly focused on because we saw this I'll just give people what I'm thinking about."
00:00 / 00:17
AFFILIATE LINK · ZORTIX MAY EARN A COMMISSION · NEVER A RECOMMENDATION TO TRADE