To The Moon

Ackman Waves the White Flag on Treasuries - Is it Time to Go Long?

Just a few days ago, our man Bill Ackman sent shockwaves through Wall Street when he announced he was closing his short position on long-term US bonds. Why? Because he believes the high yields on these long term US treasury bonds are simply unsustainable. $10-YR T-NOTE - main 2312(ZNmain)$ $iShares 20+ Year Treasury Bond ETF(TLT)$ 

Bill Ackman is no stranger to making bold moves, but this one's got us all talking. He's essentially saying, "I give up, the yields are too darn high." He might be onto something. When a legendary investor like Ackman throws in the towel on a bearish bet, it's time to pay attention. This isn't just any stock; it's US government debt.

Ackman's move suggests he sees a shift in the bond market. When yields rise, bond prices fall. If those high yields aren't sustainable, it means bond prices could rebound. So, is it time to buy US treasuries? Well, it sure looks like a tempting play right now. Lower bond prices could make for higher returns if Ackman's instincts are right. But, i’ll hold on to my pocket tight first and consider the flip side.

Rising bond yields are often seen as a sign of inflation worries. I can’t be fully bullish on it. If you believe Ackman and think those yields are headed down, you might want to jump in. But if you're inflation-wary and see yields going up, you might want to be cautious.

In the end, Ackman's move is a reminder that even the big shots can change their minds. The bond market can be as fickle as a cat on a hot tin roof, and it's up to you to decide if you want to join Ackman's about-face. Ackman's treasury twist has us wondering if it's time to buy US treasuries. His move suggests that those lofty yields might be on the way down, which could mean potential gains for bond investors. But, don't forget the inflation bogeyman lurking in the shadows. $S&P 500(.SPX)$