Not exact matches
During relatively mild equity
bear markets, like the one from
1980 through 1982,
bonds rallied strongly.
Outside of the
1980 bond performance (when yields dropped from nearly 14 percent to 9.5 percent), the two most recent equity
bear market performances by
bonds really stand out.
Putting aside the performance of
bonds during the
bear market beginning in
1980 (both because the starting yields on Treasuries were so high but also because the
bear market was relatively mild as the decline began from relatively low levels of valuation), what's interesting about the above chart is how dependably
bonds protected a portfolio during equity
bear markets.
During
bear markets beginning in
1980, 2000, and 2007 — the ones in which
bond exposure was most helpful — the rate of inflation declined.
I know it's hard for most of you to believe that Gold and Silver will surpass their old January
1980 highs, but that is what a 20 + year generational
bear market will do to a whole generation of investors who have grown up with falling real assets (Gold, Silver and commodities) and rising paper assets (stocks and
bonds).
My parents started saving before I was
born — Dad's work allowed employees to buy savings
bonds through payroll deduction and back in those days (the 1970's and
1980's, before 529 plans) Series E
bonds were a good, safe way to save for college.
Putting aside the performance of
bonds during the
bear market beginning in
1980 (both because the starting yields on Treasuries were so high but also because the
bear market was relatively mild as the decline began from relatively low levels of valuation), what's interesting about the above chart is how dependably
bonds protected a portfolio during equity
bear markets.
During relatively mild equity
bear markets, like the one from
1980 through 1982,
bonds rallied strongly.
Outside of the
1980 bond performance (when yields dropped from nearly 14 percent to 9.5 percent), the two most recent equity
bear market performances by
bonds really stand out.
There are three equity
bear market periods that stand out though because
bonds delivered larger gains, including the 2007, 2000, and the
1980 bear market.