We are usually surprised at the lack of surprise of other investors at things we consider ominous. Lately, we have been perplexed and worried about the current market apathy at the steady uptrend in bond yields. A case in point was the reaction of the financial media to the jump in yields on Wednesday, October 3rd. As the chart below shows, reacting to strong U.S. economic data, the 10-year U.S. Treasury Bond yield surged by over 0.1% or 10 bps (where a basis point (bps) is equal to 1/100 of 1%) to over 3.17%. It has since continued further upwards and is 3.25% at the time of writing.
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Canso October 2018 Market Observer
