Municipal Bond Forum
Buying indicates market sentiment
Q
With all the volatility I hear about right now in the bond market (I assume this is the entire bond market, not just U.S. treasury bonds) there is a huge uproar when it comes to selling at the high, since interest rates are going to fly. Let me know your thoughts on this.
A
James A. Klotz responds:
In our 40 years in this business, we have never seen anyone accurately predict the direction of interest rates for any extended period of time.
As a matter of fact, economists have been forecasting higher interest rates for the last 10 years. As you know, this has not materialized.
As we mentioned in our most recent commentary, “Muni Market: Heal Thyself,” individual bond buyers are executing 2.6 times more buy transactions than sells.
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