5% Bonds: Get Paid To Wait For Stocks To Get Cheaper Please ❤️like, bookmark🔖, and 🔁share with fellow investors In this Short video, @MichaelLebowitz and @AdamTaggart discuss why bonds are becoming increasingly attractive as yields approach 5% — but also why they’re not ready to aggressively call the bottom yet. * The biggest difference between today and the painful bond selloff of 2022–2023 is that investors are finally getting paid to wait. When rates were near zero, falling bond prices came with almost no coupon income to cushion the losses. Today, Treasuries are approaching 5%, while some high-quality corporate bonds already yield more than 5%. That creates a very different risk/reward proposition. Imagine buying a 5-year bond yielding 5%. If nothing dramatic happens, you can hold it to maturity, collect roughly 5% annually and get your principal back, assuming the issuer pays as promised. * But there’s another possibility that makes bonds particularly interesting. Suppose stocks eventually fall 30% while bond yields decline from around 5% to 2.5%. As yields fall, bond prices rise. You could potentially sell the bonds for a capital gain and use that money to buy stocks after a major valuation reset. In that sense, bonds can offer income, defense and optionality: get paid while you wait, then potentially rotate into stocks when valuations become much more attractive. * There may also be a natural institutional “put” developing around these yield levels. Pension funds and insurance companies don’t necessarily need to perfectly time the top in yields. At close to 5%, many can begin locking in returns that help satisfy long-term liabilities. They can buy some now, buy more if yields rise and gradually ladder into the market. * But attractive value doesn’t mean the bottom is in. Mike still wants to see technical evidence that the bond trend is reversing, bearish narratives beginning to change, more economic data and greater clarity about what the Fed will do over the coming months. That leads to an important point: it could actually be better to buy the 10-year at 4.5% after a confirmed reversal than at 5% while yields are still climbing. You sacrifice some yield, but gain confidence that yields may be heading toward 2.5% rather than 5.5% or 6%. * The takeaway: bonds near 5% are becoming increasingly compelling because investors can finally earn meaningful income while waiting for a better opportunity in stocks. But don’t confuse attractive yields with a confirmed bottom. Sometimes it’s better to give up the first part of the move and wait until the market confirms that the tide has actually turned. #yields# #bondmarket# $TLT $BND 💡 Get access to my notes with the key takeaways from this interview with @MichaelLebowitz by visiting my Substack (link below) ⬇️