Title: Bond limbo: How low can rates go?
Headings: Bond limbo: How low can rates go?
Bond limbo: How low can rates go?
Investors are running away from stocks as fast as they can.
Markets go for a wild ride
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Content: Investors had been much too complacent until recently." The big drop in rates is a bit curious though given that the Federal Reserve is about to end its long-running bond purchase program, a policy known as quantitative easing or QE. At the beginning of the year, many experts thought that the 10 Year Treasury could finish 2014 with a yield of more than 3%. Some thought 4% wasn't even out of the question once QE was over. What appears to be happening is that foreign investors are still buying massive amounts of U.S. debt. China and Japan each hold more than $1 trillion in U.S. Treasuries. Could rates fall even further from here? Yes. But the bottom would probably have to fall out of the U.S. economy for Treasuries to hit a new record low. Low rates aren't always a good sign.