Charles Nenner: Bond Kondratiev Cycle Peaks This Fall

By on April 9, 2012

Charles Nenner - Charles Nenner Research CenterCharles Nenner was recently interviewed by Neil Cavuto regarding his outlook for the economy, stocks, and bonds.  Charles Nenner is chairman and president of the Charles Nenner Research Center, an advisor to hedge funds, banks, investment houses and private clients.

Nenner said the overall economy was going to be stronger than everyone thinks; maybe one or two nice quarters of around 4% GDP growth. After that (in 2013), the economy would get weaker than everyone thinks.

Nenner expected a new rally to begin in bonds in 10 days to 2 weeks (around now since this interview was on March 27th).

The bond rally could possibly take bond prices to new highs, according to Nenner. Cavuto commented to Nenner that he must not believe bonds are in a bubble. Nenner said the bond market was a bubble that hadn’t ended yet, but it would burst around September – October.

Nenner said bonds have been in a Kondratiev cycle for 30 years and that over the next 30 years the cycle will be for higher rates. Nenner said this shift would be very bad for the economy because there is more money in bond funds than equity funds. This will result in consumers having less money to spend.

Nenner indicated the coming bond bear market would not be good for stocks. Cavuto asked him where he would put his money. Nenner commented that he was Dutch and they try not to lose their money. Nenner said there are certain times when there is nowhere to go but cash.

Cavuto asked Nenner how his prediction would effect Obama’s re-election chances. Nenner said it would be good for Obama, who he considers “anti-capitalism.”

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