AGG - Bond Market Asset Class Annual Returns - Rate Cuts?

2024-03-18 07:35:00 ET

Summary

• Wall Street and the investment community seem to be greatly overestimating the prospect for interest rate reductions in 2024.
• The move in the 10-year Treasury yield jump to 4.3% as of March 15th was not really unsurprising given the inflation data this past week.
• What I worry about is that 2020 through 2029 is as bad a decade for bond market returns as 2000 to 2009 was for stock market returns, and that’s always a very tough prediction to make.

With the FOMC meeting announcement this coming Wednesday, March 29th, 2024, and Wall Street and the investment community still talking potential interest rate cuts, it can’t be helped but think of the old Indianapolis Colts head coach, Jim Mora, ranting about, “ Playoffs? Don’t talk about playoffs… Playoffs? ” The prospects for the Colts making the playoffs under Mora given the way they were playing are about as solid as the FOMC reducing the fed funds rate in the next few months....

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