The bond market went into hibernation over the summer, with yields holding steady despite surging inflation, a looming battle over the federal debt ceiling, and the prospect that the Federal Reserve will begin reducing the size of its monthly bond purchases later this year. We see the potential for the market to awaken this fall, with yields moving up. Currently, 10-year Treasury yields—which move inversely to prices—are sitting below 1.5%. It appears that investors are pricing in a return to lackluster growth and low inflation. We believe the market is too complacent and investors should be prepared for higher ... (full story)