Pragmatic Capitalism

Capital for Living a More Practical Life


Revisiting Price Compression – Long Bond Edition

If you’ve read my paper Understanding Modern Portfolio Construction you know that I like to think of all financial instruments as if they’re bonds.  This is helpful for multiple reasons: It helps provide a realistic timeframe for holding certain instruments. It helps put the various risks of those instruments in the right perspective. The thing… Read More

Thoughts on The Bond Debacle

Earlier this year I discussed the fairly dramatic change in my view on long-term government bonds. In essence, I said that bonds were irrationally priced given the low likelihood of deflation that the market was pricing in. Since then long bonds are one of the worst performing asset classes in the world on both a… Read More

There’s No Bubble in Bonds, but They Look Frothy

I’ve been a bond bull for as long as I’ve written this blog. Over the course of the last 6 years I’ve repeatedly defended bonds in a portfolio, explained why US government bonds were not at risk of default or high inflation and I’ve spilled a huge amount of ink trying to explain why bonds… Read More