I gave up on trying to talk with ANYBODY who even has an interest in Treasurys, so I don't mind at all a conversation with you "Shorts."
I'm convinced that the Treasury speculation that has driven down rates will continue-let's be clear here-the Treasury bulls are not in this for the lousy yield, are not interested in holding to maturity, but in the PRICE AT THE LONG END OF THE CURVE, where the risk/reward is at it's highest.
I'm a believer that we are entering a period of great fear of anything but the least complicated of investment assets-why else should Gold Buillion (what could be simpler) be $900+ an ounce AND 1950's (almost) type Treasury yields exsist side by side? Something is most tragically different from the last time Gold was at this level ($850 was the old record)-namely the almost 8% difference in the yield of the Ten and Thirty. I'll tell you why: because the smart money (me, HAHA) is already out of CDO's, MBS's, CDS's etc. and are willing bid up the PRICE of the Ten and especially the Thirty in the complete and blissful security that only a Government guarentee can provide (a little sarcasm here.)
Look, if I'm wrong, I'll admit it (eventually, HAHA)but as our first point of contention, explain to me $900 Gold AND a 3.55% Ten Year Note. Or better yet, explain it to yourself and ask if you really want to bet against what I believe to be the start of a huge derivatives meltdown that will eventually make our rates look like Japan's.
P.S. As a general rule of thumb, make sure you know about a little thing called "inverse compounding" that applies to any fund that tracks an index inversely, and prices on a daily basis-even if the 30 moves back and forth for a long period of time and stays ultimately in the same place, you will lose money.
I hope the guys at Rydex told you about that. Nice talking to you fellas.