Readers of my most recent columns know that I’ve been very critical of the Federal Reserve’s sluggishness – if not actual lack of resolve – to start raising short-term interest rates now that the economy has finally started to show some staying power. The earliest projections, both from Fed officials and market prognosticators, is that the first rate hike won’t come until well after the end of the first quarter of this year, if not sometime in the second half.
But even if the Fed should start taking my advice and start raising rates sooner – it looks like the March 17-18 FOMC meeting would be the earliest – don’t draw the conclusion that I also think long-term interest rates are headed any higher anytime soon.
If anything, I think long-term rates are headed lower in 2015, meaning I think this year will be another good year for bonds, U.S. Treasuries specifically.
That makes me a bit of a contrarian, which is usually where I feel most comfortable anyway. Continue reading "Best 2015 Bond Bet: Long U.S. Treasuries"