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What lies ahead is a new era of rising interest rates, soaring consumer prices, increasing unemployment, economic stagnation, and lower living standards. Instead of stimulating the economy, quantitative easing and deficit spending will prove to be a lethal combination. Bondholders beware, the bell tolls for thee. --------------------------------------------------------------------------------

So, should we sell every Treasury Bond we own?

RE :”So, should we sell every Treasury Bond we own? “

There is no way I would give investment advice here but when I posted this Jim Rogers video almost two years ago I thought it was brilliant and still is.

“The fundamentals of General Motors are impaired. The fundamentals of City Bank are impaired by what is happening. The fundamentals of most industries of the world are very impaired. The only thing I know where the fundamentals are not impaired, but are enhanced, are commodities, coming out of this. Things are so bad that some farmers can’t get loans for fertilizer. No one can a loan to get a new mine. Mines are closing, farmers are suffering. So the fundamentals of commodities are actually getting better because the supply is under terrible pressure when the world is going to continue to eat and everything else. The best place to be invested now is commodities, China, the Yen and commodities. Commodities have been in a bull market since 1998, 1999. The bull market was caused by supply and demand being terribly out of balance In the 80s and 90s there was very little money invested in productive capacity for any commodities;
Jim Rogers/Asian Financial Forum (World Commodities fundamenals enhanced)1/21/09 |Jim Rogers

So, should we sell every Treasury Bond we own?

Not unless you think the market is wrong in its assessment of US government default risk. That's not something I worry about much because if the government defaults, we'll end up in a world where guns and seeds will be the only thing of any value.

I'm also not worried about hyperinflation because the Fed has the power to stop it pretty easily, and hyperinflation would hurt virtually every politically powerful interest group in the US. The Fed's going to keep inflation running between 2-3% per year. Worst case they'll screw up some one year and it might get up to 4%, tops.