Seeking Alpha

DoctoRx's  Instablog

Send Message
Over 30 years of investing in individual stocks. Extensive business experience with small to mid-size companies, including as CEO. Many hundreds of blog posts on financial and economic matters since 2008. Focus on value with catalysts for upside price action. Background as a physician and... More
My blog:
  • A Quick Comment On Bonds 0 comments
    Dec 17, 2013 10:47 AM

    Official government inflation data are benign. There is much derision of these findings. However, an independent source, PriceStats, which tracks online pricing, is finding that inflation is indeed trending down, to 0.11% monthly. This contains within in a link to the raw data.

    Another point for inflationists to consider is that the Effective Fed Funds rate is running around 9 basis points. This is said to be a free market rate. If inflation/economic growth (i.e. nominal GDP) were heating up, this should move to the top of the Fed's range, or toward 25 bps.

    The current situation is therefore murky. With the U.S. effectively at peace, it's good to recall that except for the aftermath of the Vietnam War and concomitant demographic pressures from the Baby Boom, price stability or even deflation has been the norm in this country during peacetime.

    The only thing I'm sure of is that bonds remain in a structural long term bull market. Are they entering a bear market or a choppy one? We shall see, but for now it appears that risk-takers in intermediate or long term bonds are at least receiving a positive current return on their investment after inflation. Thus a surprise rally in yields downward is a possibility.

    Themes: Bonds
Back To DoctoRx's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »

Latest Comments

Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.