What is the UST bond market trying to tell us? The 10-year UST at 1.45% is certainly not telling us to fear embedded inflation, though many still do. Maybe it is telling us it is Goldilocks time. But as an investor/advisor, I do not get paid to believe in fables. Maybe the bond market (together with what I think is a healthy pause in commodities) is telling us to start worrying about a sharp slowdown in US growth, which is a much more worrisome bear case than a year of 3% US inflation.
I learned long ago that you should always have a bear case – the event/issue that will upend the bull case you normally lead with. So here is mine.
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