svosavvy

What to Buy and Why: Barron's 2009 Roundtable, Part III

naidle

you short treasuries after the next big selloff because you look for rate deterioration. Basically if you bought a treasury now and we had a big selloff that will most likely increase the par value of that T. Basically you want to short when the yield and par are at their absolute lowest, because some day along with inflation and market appreciation you will also get higher interest rates. Higher interest rates are the bain of people who do "safe haven" buying of bonds. That paltry rate they settle for basically guarantees no one will buy that issue from them at par therefore they sell at a loss or keep it to maturity and get their crappy rate. Buying treasuries now is the equivalent of buying stocks high. It's dangerous to buy fixed debt here unless you're dealing in very short term issues. If you're conservative you might want to wait for the next crap day on the markets and get yourself a few treasury TIPS.

What to Buy and Why: Barron's 2009 Roundtable, Part III

Dr Marc, oil at $147 was the short of the century. I love the short the treasuries idea I think it has play. Wear some brighter colors when you're on tv, starting to look like the bad guy from the second Bill & Ted movie.