CNBC Stock Blog
- Portfolio Prep for Next Week: 'Don't Get Crazy'
- Strategists on Dubai: Avoid 'Rash Moves' Now
- Dubai Stock Market Fear Has 'Legs': Dennis Gartman
- Surprising Options Trades in TiVo Shares
- 10 Dividend Picks For Your Portfolio: Chief Investors
- 4 Thanksgiving Week Buys For Your Portfolio: Market Pros
- There's a 'Great Chance' For a Double-Dip Recession: Strategist
- Retail Earnings and Sales to Improve in Q4: Analyst
- 4 Food Stocks to Stuff in Your Portfolio: Analyst
- S&P at 1050-1200 Trading Range Next Year: Strategist
MOST SHARED
- U.S. Stocks Fall on Dubai Worries
- Black Friday at Best Buy
- Strategists on Dubai: Avoid 'Rash Moves' Now
- Longer Lines, Fuller Carts This Black Friday
- Dubai Stock Market Fear Has 'Legs': Dennis Gartman
- Obama's Emission Reduction Pledge Paints Future for Autos
- Is Super Bowl Halftime Act Too Old?
- Surprising Options Trades in TiVo Shares
- EA Sports Hopes to Pump Up Sales Through Pop-Up Locations
- Abu Dhabi Will Aid Debt-Fraught Dubai 'Case by Case'
- Banks With The Biggest Exposure to The UAE
- Dubai's Debt Woes Signal New Era for Creditors
- Next Week: Cash In Now Or Wait For A Santa Rally?
- Dubai Stock Selloff May Bring Buying Opportunity
- Longer Lines, Fuller Carts This Black Friday
- Big US Banks May Be Forced to Raise Capital: Bove
- Bank of America Amends Pay for Senior Executives
- Tiger Woods Out of Hospital After Accident
RSS FEED
Text Size 
CNBC News Associate
During the height of the financial crisis, investors flocked to the safety of U.S. treasury debt and many on Wall Street are now calling the top in treasurys. So have bonds turned too risky? Kevin Giddis, managing director of Morgan Keegan and Michael Pond, strategist at Barclays Capital shared their insights.
“There’s still such strong demand in the treasury market if you look around for available investments and we’ve seen the contraction of a lot of spreads,” Giddis told CNBC. “Treasurys continue to be the game in town … there’s still a great demand for treasurys and it may go on a while longer.”
Giddis said bonds have capital structure and their seniority to equity makes them less risky.
“At some point inflation is going to come back, but you’ve still got a window,” said Giddis. “You’re well into next year before this is a big problem. We can peak in yields to the downside in the next 3 to 4 months, but the buyers aren’t thinking 3 to 4 months out, they’re thinking about today. And the buying continues for the balance of this year.”
Investors should build long-term portfolios using municipal bonds, recommended Giddis.
In the meantime, Pond said most risk assets are all going in one direction while bonds are going in the other.
“Supply has increased dramatically over the past year,” said Pond. “We think next year’s supply in the coupon area in treasurys will be even greater than this year. Supply will continue to move up and we think demand for safe haven bid in treasurys will fade if we get the sustained balance in GDP that we expect.”
Pond suggested buying TIPS rather than normal treasurys because they offer very cheap inflation insurance.
______________________________
Disclosure:
No immediate information was available for Giddis or Pond.
______________________________
CNBC Slideshows:
______________________________
CNBC's Companies in the News:
Berkshire Hathaway [BRK.A
Loading...
()
]
Goldman Sachs [GS
Loading...
()
]
Bank of America [BAC
Loading...
()
]
Ford [F
Loading...
()
]
Kraft [KFT
Loading...
()
]
______________________________
Data is a real-time snapshot *Data is delayed at least 15 minutes