When valued in terms of gold, the price of the US Long Bond has now fully retraced the presumed gain it achieved between 1980 and 2001. In other words, in ten years, what is widely considered as the single safest investment in the world has lost 100% of the presumed value it had accumulated in 21 years.
Considering interest rates have been at their lowest in living memory and for a few generations beyond that, what are the chances the Long Bond can regain some composure?
By the way, in case you had missed it, this same picture illustrates by and large the performance of your presumed pension fund or, if you like, it measures your purchasing power parity between then and now.
Let the major banks fail! Iceland should be our model. Ireland is our hope. Let the major banks take their lumps.