The recent precipitous decline in long-term bonds has brought about a flurry of discussions among the investor and financial analyst communities, drawing notable parallels with some of the most infamous market downturns in history. Bonds with a maturity of 10 or more years have witnessed a 46% decline since their peak in March 2020, which closely mirrors the 49% drop in US stocks in the aftermath of the dot-com bubble at the turn of the century. The situation is even more alarming for 30-year bonds, which have plummeted 53%, nearing the 57% slump in equities during the 2008 financial crisis.
Genevieve Roch-Decter, CFA, brought this alarming trend to light in a tweet on October 5, 2023, drawing a stark comparison between the current bond slump and the stock market crashes during the dot-com bubble and the 2008 financial crisis. Roch-Decter underscored that the declines in 10-year and 30-year bonds are approaching the epic…
