Here is a cute little chart that shows the dynamics that goes on when we look at bonds. It is a bit of a chicken and egg story in which comes first. I also flip this saying around, “When Bond Prices Fall, Interest Rates Rise”.
The Fed can only raise rates in what the bond market and the 30-Day Fed fund rate allows them to do. The Fed runs on fundamental data, which I know are always lagging indicators. I for one do not believe in rates getting out of control, as the FED is always fighting the wrong battle at the wrong times.
The future threat is “deflation” folks, not inflation. If you don’t believe that just yet, then I beg you to spend the entire day searching the internet with, ” 10,000 Boomers retiring every day for the next 19 years”. Economists, climate change models, and investors are ignoring this biggest demographic shift in history! This has been going on since 2011 and will continue until about 2030.
This demographic shift has huge implications for all types of real estate investments, or static investments like gold and silver. Below is the monthly T-Bond chart price that hit a 120-year low in 1981. It has been bullish through all types of crashes and bear markets since then.
I tried the 1981 bottom position in GSC degree, but GSC degree has too many time forecast loopholes in it, so I dropped down one degree to a Supercycle degree wave 2. 5 waves up in Cycle degree is what we are looking at, and wave 1 in Cycle degree has not arrived yet.
I was suspicious about the T-Bond top containing an expanded pattern, which means the asset class in question, should make another new record bull market high. When we add 120 years ( 4, 30-year cycles) to the 1981 bottom we get the year 2101, which is my Submillennium degree wave 3 peak!