BTZ - What Will Happen To Bonds If Interest Rates 'Normalize'?
There's a lot of chatter out there about rising interest rates and "normalizing" rates. As I've written about before, I think most of these fears are a case of short-termism being way overblown.¹ But I want to put things in some perspective and show you a scenario analysis of how things might look if bond yields do jump a bit and "normalize".²
To run this scenario analysis, I want to look back at the period from 1956 to 1970 when rates jumped from 2.9% to 7.78%. With the 10-year t-note yield at 2.85% as I