No Bonds!

Great sentiment data here from David Rosenberg.   I know he catches a lack of flak for his negative stance on the economy, but there’s no debating the fact that he’s been dead right about the bull run in US government bonds.  And that’s at a time when virtually no one thought he was right (well, except for maybe yours truly, Gary Shilling, Van Hoisington and a few others).  Here’s the data and commentary via DR:

“A loyal reader sent this to me yesterday – the Barron’s Big Money Poll from the Fall of 2011, when only 5% of the portfolio managers surveyed were bullish on US Treasuries and a whopping 73% were bearish.  What a great call seeing as the 10 year t-note has collapsed 45 bps over that time frame to 1.7% and in the process generated a net return of 5%.  Back then, only 18% were constructive on corporates (27% negative) and  17% on muni bonds (35% bearish).  “

The note goes on to show that the 2012 BM Poll showed 2% bullishness on US T-bonds and 81% bearish and 14% bullish on corporates and just 12% bullish on munis.  That comes out to an average of about 9% bullishness on fixed income.  And the result from this years poll?  11% bullish on fixed income, 89% bearish, and as I noted the other day, a record 86% bullish on equities.

It’s also interesting to note that 30 year US Treasuries have averaged an 8% compound growth rate over this period….Not too shabby.

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Cullen Roche

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering asset management, private advisory, institutional consulting and educational services. He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance and Understanding the Modern Monetary System.

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