KirkLindstrom.com - Articles - Articles - 2015 - Buffett Would Short 20 and 30 Year Bonds
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 Warren Buffett: Bonds Very Overvalued
 Kirk Lindstrom on Cover of Timer Digest
Buffett would short 20- and 30-year bonds

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May 5, 2015: Yesterday the 30-year US Treasury bond paid 2.88%, just a few tenths above historical lows.  Warren Buffett is best known for long-term investments in stocks, but he also makes bets in the fixed income market such as loans to Goldman Sachs and GE during the financial crisis..  Yesterday I watched Warren Buffett on CNBC say1:
  • "I think that bonds are very overvalued." 
  • "If I had an easy way, and a non-risk way, of shorting a whole lot of 20- or 30-year bonds, I'd do it."

On why he is not short bonds:

  • "But that's not my game, and it can't be done in the kind of quantity that would make sense for us. But I think that bonds are very overvalued. I'll put it that way."
Historical 30-Year Treasury Bond Rates
Feb 1, 1977 through this week  
30-Year Fixed Rate Mortgage Average in the United States

Recent Rates
Date
 %
2015-05-04: 2.88
2015-05-01: 2.82
2015-04-30: 2.75
2015-04-29: 2.76
2015-04-28: 2.68
This charts from the St. Louis Fed update automatically when new data is available. 
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Kirk Lindstrom on Cover of Timer Digest

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Note 1.  Verification of Buffett's comments: BUFFETT: 'I think that bonds are very overvalued'
Note 2.  Data is provided "as is," by Freddie Mac® with no warranties of any kind, express or implied, including, but not limited to, warranties of accuracy or implied warranties of merchantability or fitness for a particular purpose. Use of the data is at the user's sole risk. In no event will Freddie Mac be liable for any damages arising out of or related to the data, including, but not limited to direct, indirect, incidental, special, consequential, or punitive damages, whether under a contract, tort, or any other theory of liability, even if Freddie Mac is aware of the possibility of such damages. Copyright, 2014, Freddie Mac. Reprinted with permission.
 
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