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unhappycamper

(60,364 posts)
Tue Jun 24, 2014, 08:45 AM Jun 2014

How long will bond holders take disappointing returns?

http://www.thenewstribune.com/2014/06/24/3258663/how-long-will-bond-holders-take.html?sp=/99/261/

How long will bond holders take disappointing returns?
June 24, 2014

There’s an old saying that the stock market can remain irrational longer than investors can remain solvent.

But when it comes to the bond market and dealing with interest rates, solvency isn’t the issue.

The bond market can remain irrational longer than investors can remain tolerant, and judging from the conversations at the recent Morningstar Investor Conference in Chicago, investors are running out of patience in this low-yield environment. That’s not entirely a new trend, but it is growing as the rate hikes that most investors expected to see in 2014 have been pushed back and now aren’t anticipated to arrive by most experts for 12 to 18 months.

Bond fund giant Bill Gross said in Chicago that he believes the bond market will be stuck in “the new neutral,” but that’s not a status that most investors will be willing to ride with for long.
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