Normally, bonds offer protection from a stock market storm. But this is a weird environment where bonds are not buffering the decline in stocks, they’re causing it.*
Earlier in the month, both stocks and bonds were in a 10% drawdown for the first time since 2008.
Bonds have had a rough run lately, but the next chart shows why you don’t throw them in the garbage when they’re treating you like trash. The worst bonds can do is give you indigestion. Stocks can make you vomit.
*That’s hard to prove but it’s a good line so I went with it anyway. Sue me.
Josh and I are going to talk about this and much more on tonight’s What Are Your Thoughts?