Last Friday, the 30-year Treasury yield closed above 5%. That's the highest level since 2007... back when Lehman Brothers was still standing and the iPhone was three weeks old.
Almost nobody mentioned it.
The financial press was busy lining up for Wednesday's Nvidia earnings, where options markets are pricing in a 6% move. Understandable. AI is the story of the cycle. But here's the thing about long bond yields above 5%... they don't usually break out alone. They drag everything else with them.
Higher yields mean tighter financial conditions. They mean mortgages stay punishing. They mean the discount rate applied to every speculative tech valuation moves the wrong direction. And they mean the era of "buy any dip in growth stocks" is being quietly tested in real time.
I've watched this movie before. October 2007. The bond market started whispering. Six months later, it was screaming.
I'm not predicting a crash. I'm telling you where to point your attention. The story this summer will not be written in the chip sector. It will be written in the long end of the curve... and the people watching it now will be the ones still standing in six months.
Greg
This is what I am watching now
Disclaimer:
This content is for informational and educational purposes only and does not constitute financial, investment, or trading advice. All opinions expressed are based on publicly available data believed to be reliable but are not guaranteed for accuracy or completeness. Investing and trading involve risk, including the possible loss of principal. Always perform your own due diligence and consult with a qualified financial advisor before making investment decisions. Past performance is not indicative of future results. Paid ads from 3rd parties are clearly identified. We do NOT specifically endorse these products nor are we responsible for the content of these ads. You should assume an affiliate payment will be made to us if you click a link or buy a product.