“Some day interest rates will go up. Until then the Treasury bears are missing one of the greatest bond rallies in history.” — Jim Bianco, Bianco Research
Since 2015 began, everyone has been fixated on the U.S. dollar and oil prices. I want to direct your attention to what may be the greatest show now playing in financial markets: The 30-year U.S. Treasury bond.
The chart above, courtesy of Bianco Research, shows the year-to-date returns of the long bond during each of the past 40 years. Never has the 30-year Treasury, depicted by the blue line, had a stronger start to a new year going back to 1974.
Jim Bianco of his namesake firm notes that in January the 30-year bond returned 10.71 percent. That ranks as the seventh best month ever for the security. We don’t know if that is going to continue, but it is certainly worth watching.