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Thread: Where is the Bottom to Dow Jones?
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Old 04-18-2020, 11:03 PM
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Originally Posted by DON10E View Post
Consider being very careful about holding bond funds. The ten year treasury bond is selling close to .6%. Not 6% but point-6 %. There's not a lot of room to drop from here. If rates go up the value of bond funds will drop. A rate increase from .6 to 1.2 could cause a 50% drop in the value of bond funds, depending on the bond maturities. Rates have never been lower in our lifetimes (well, mine anyway).

You said you're in cash bonds. Cash is an asset class and bonds are an asset class, but cash bonds is not an asset class, so decide how much of this post actually applies to you. Be careful. Also, feel free to ignore anything I say.

Good luck. Wash your hands!
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Totally agree, bonds are a suckers play at these rate levels, especially with the eventual inflation that has to occur (declining value of the US $) because of how much the Fed is increasing the money supply. And that is only talking about US Treasury bonds, Corporate bonds will have it much worse with increased default rates.