I don't see any investment value in the ten-year treasury at all ... I have been saying I think the yield could rise 100 basis points from where it is now even before year end. For this reason we have gone to the lowest interest rate exposure in history in the summer of this year ... I think the reason ten-year treasury rates can go up is because it is so unattractive as an investment at 1.8%.
We're in this kind of situation of zero interest rates and the fed doing what they can seemingly as far as the eye can see, but it won't bring interest rates down. Just look at the bloodless verdict of the market.
Now the problem with all of this manipulation of the market is you can play a small ride to a gain but once you get to that gain what's the forward looking prospect? It is less.
As my friend Jim Grant says we're living in a hall of mirrors where you don't really know what investors think because the price discovery is being destroyed by government intervention and to that basis I don't really like what the Fed is doing.
In general, I don't like risk assets at the level they're at today in the short-term and I am not very positive. In the longer term i think these policies that the Fed is trying to put in place mean that longer term you want to be involved in real businesses and real assets that can have the ability to preserve purchasing power and move forward. I don't think we'll have a lost decade and I won't buy them because everything is so high.
I think the obsession with Apple is truly remarkable social phenomena. When you watch CNBC, everybody wants to talk about is Apple going up today, down today, fixation, obsession, with apple. to me that means the stock is over believed and over bought.
What I am going to talk about for investors recommending stocks or stock markets is pair trades - looking at things and saying if we're going to get inflationary fix, you want to own the Spanish stock market. You want to own natural gas. You want to own agricultural commodities. Short things like Apple and the S&P ...