The History of 10 Year Treasury Yields

By on August 28, 2010

There has been a lot of talk of a bond bubble throughout this year. Despite these fears, yields have tumbled and bond prices have shot up year-to-date. Barry Ritholtz recently posted a 220 year chart of 10 year treasury yields which shows that relatively low rates have been the norm throughout the history of the U.S.

Click on chart for larger image:

SMA Comment: This chart vividly shows that rates have stayed low for long stretches of time so worrying about a bubble in bonds is likely a misplaced fear. However, markets (even the relatively calm fixed income market) can make dizzying moves without warning. My feeling is that rates will stay low for an extended period of time as the economy continues to de-leverage, but the big money has already been made in the bond market.

Source: The Big Picture

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