🚨The decline in U.S

🚨The decline in U.S. bond prices is more than noticeable🩸

👉Government bonds with maturities over 15 years have posted an average annual return of -2% over the last 10 years, the worst result in history. This is only the second time since 1936 that these bonds recorded a negative annualized return over a ten-year horizon. During the same period, U.S. stocks achieved an average annual return of +15% and commodities +11%. Before 2020, government bonds had an average annual return of +9%.

👉Since 2020, $TLT has fallen by 26%, with a maximum drawdown from its peak of 34%. Bonds are no longer the safe haven they used to be.

👀I'm curious myself what this will do to stocks and their overall returns. Anyway, I should be on the lookout.

What do you think?

Great historical context, that $TLT drop is really exceptional. Just important not to confuse a historical loss with the future profile of the asset.

Bonds haven't stopped being safe from a repayment standpoint – the US government always pays its nominal obligations. Those who wanted price stability should have held short-term Treasury bills, not an ETF with a duration of 16+ years. With a 20-year bond, a 4% rate move simply had to hurt price-wise, that's pure fixed-income math.

The key difference is today: in 2020 you were buying asymmetric risk (near-zero yield and huge room for price decline). Today you're buying 4–4.5% p.a. in cash, and if a recession comes and the Fed starts cutting rates, it's long bonds that will offer significant capital growth.

For stocks, this means a return of healthy competition. For the last 10 years capital had nowhere else to go. Now it has an alternative, which will put long-term pressure on P/E multiples and force companies to actually deliver earnings, not just growth stories.

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