Category: Market Commentary
The conditions that precede a battle with the bond vigilantes are high deficits coupled with what is viewed by the bond market as excessive spending. Against that backdrop you can understand the recent spike in yields across the intermediate and long end of the yield curve.
The English theologian and historian Thomas Fuller is the first person to commit the notion that ‘the darkest hour is just before the dawn’ to print. His religious travelogue A Pisgah-Sight of Palestine And the Confines Thereof, 1650, contains this view: “It is always darkest just before the Day dawneth.”