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Comment of the Day: Long-Term Treasury Bonds Not Yielding Well

2017-12-25

David

California 9 minutes ago

Long term bond yields on Treasuries are around 2.5%.
That doesn’t seem consistent with the prospect of long term
real growth of 4%.
If we are going to grow at a 4% rate, somebody needs to inform the bond market.
either that 4% growth rate number is bogus or long bonds are way overpriced.

Long-term Treasury bonds are sold at rates that “float”, meaning yields represent savvy investors’ estimates of what real growth will be over the next 5-10 years… i.e. no better than growth over the last ten years.

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