The rumblings have ramped up: Interest rates are looking ripe to rise. That has several implications for savers, investors and, perhaps especially, bondholders. Robert Johnson, president and CEO of The American College of Financial Services and lead author of Invest With the Fed, shares his thoughts on the situation.
Q: The current bull market is the longest in history. Are you seeing signs that it’s aging out?
A: The interesting aspect of the question is that the assumption is it’s a reference to an aging bull market in equities. The real aging bull market is in bonds. Essentially, we have been in a secular long-term bull market for bonds since 1981. It seems that investors are very conversant with developments in the equity markets, yet fail to see the high valuations in the bond markets.
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