Being a perma-bear is a little like a football coach selecting proven yet underperforming players and tactics in a season of poor results: changing course is difficult once you’ve invested a lot in a team roster and strategy, even though most enthusiasts understand that the game has moved on. But there is a key difference: the perma-bears know that the longer they are wrong, the more likely they are to be correct tomorrow. We should therefore not ignore perma-bears, while also trying to avoid the trap of being wrong for the wrong reasons.
That said, my core views on the current state of fixed-income markets include:
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