“I’m Insanely Bullish on Bonds” | Jared Dillian on Copper, Bonds, Semis, and The Awesome Portfolio
Episode publishedPodcast: Monetary Matters with Jack Far...Monetary Matters with Jack Farley
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Joined today once again by Jared Dillian of the daily dirt dap and the new book, the awesome portfolio. Jared, good to see you.
Good to be here, man. Thanks for having me.
Yeah. You too. Jared, looking at the front page Bloomberg, global bond sell off sends yields to highest level since 2008. What do you make of the bear market in bonds that we've had? The fact that these long term government bond yields can't really seem to catch a bid. Your thoughts.
How much time do we have?
How much time has you got?
This is a this is a very long story. So I am of the belief that there is a mind virus going through people in the market. People believe that deficits are out of control. People believe that inflation is out of control. We are really back to where we were in the late seventies when people were calling bonds certificates of confiscation. The reality is is that inflation is not that high. It's come down quite a bit in the last couple of months. It continues to come down. Yes. It's been above the target for five years. Yes. Warsch did say it's a firm target. I don't understand the obsession curre
And you so you're bullish on bond. You think that the narrative of that bond yields are gonna go to the the moon is he's gotten totally out of hand.
Oh my god. Yeah. I mean so somebody just sent me I guess Ray Dalio wrote a piece in Time Magazine about bonds. Like you said, it's on the Bloomberg front page every single day, Like, every single day. People are obsessed with it. And, know, I'm a sentiment guy, so when I see stuff like that, like, you know, I'm just nat naturally going the other way.
Yes. And the point you make about supply is interesting because there's a video I've seen of Paul Volcker, you know, rest in peace, legendary Fed chair, probably 1978, 1979, somewhere around there. You know, maybe early early eighties. But, you know, the the the long term yields were, 12%. And he was asked, why are yields so high? And he said, well, the government is having to compete out in the market, and there's just not enough you know, there's just so much bonds that are being issued, the private sector, the government. And, obviously, what we have now is 10 to 50 times higher in terms of
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