. . . the trend in the bond market . . . still looks bearish. ...
As yields rise and inflation eases, the relative allure of bond payouts becomes attractive, in absolute and relative terms vs. other assets.
James Picerno, here.
Yields are indeed rising, but prices are still falling, so no, not quite yet. Bond prices ought to stabilize when inflation finally eases, and so far prices haven't stabilized.
VWESX is instructive.
There's just a handful of years back in the 1980s where the average price of this very long term investment grade bond fund had been below $8 like the current price is today.
That's one reason why Jeffrey Gundlach rightly says that bonds are "wickedly cheap".
But VWESX only just got there on September 20th, hitting $7.99. We're down to $7.88 this weekend.
Meanwhile yields across this investment grade spectrum are bunched up in the fours, with only about 55 basis points difference between the shorts and longs, and intermediates effectively paying the same as or more than longs.
Prices on the longs need to fall a lot more before making them more attractive than intermediates if you are going to settle for only similar yield.
After all, the long term average return of investment grade longs is north of 7.5%, not in the fours.
But what the hell do I know?
Invest, or don't, at your own risk.
