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Buzz and Banter

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Earlier I made light of Fed Chairman Greenspan's promise that interest rates would remain low "indefinitely." Now, I want to be a bit more serious and look at some technical evidence to support why the Fed Chairman can make such an assertion. (Note: I would like to distinguish between the belief that he can make an accurate assertion about the direction of interest rates, and the belief that he can, over an extended period, exert a large measure of control over the direction of interest rates.)

Below is a longer-term look at the 10-Year Yield Index (TNX). Although this strips some important nuances away from what a short-term, active trader will find useful, I do believe this chart shows very clearly the primary trend of the TNX and why it may still a bit premature to declare the longer-term bull market in bonds dead.

No positions in stocks mentioned.

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