I don't usually take the contrarian view to the Russell commentary but here goes.
Firstly I'm sure it's true that the Fed and the White House will do everything they can to pump the economy for the next 12 months. However I can't see the logic of jumping off the train this far out. I'm as bearish as the next person but trends, even illogical trends, run further and for longer than anyone expects. Thus I see no psychological reason why this trend is ready to turn.
If you look at the tech boom in the US there were always 'triggers' that moved the market both on the up and downsides. E.g the Time Warner AOL merger caused a huge Nasdaq run to the upside because it said to mainstream investors, "IT is for real." Similarly the out of the blue Nokia warning caused panic as the first indicator that there was trouble in telco heaven.
Right now M&A activity is picking up in the US and Google's impending IPO is getting daily commentary. Things like this encourage investors.
Secondly RR's surprise at the strength in the 30 yr T Bills ignores the fact that they are no longer being issued. You want 30 govt issued security you have to buy in the existing market. I'd have thought that alone would add a premium, just as it does to any product in finite supply. Yield of 5.13% for the balance of 30 years doesn't allow for all that much inflation I'd have thought.
Disclaimer: I try to look at things from diverse angles to get a different perspective, however the bottom line is he's Richard Russell and I'm geffa, so who's more likely to be right? LOL.
