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Treasury Yields Have Farther to Fall

Friday, 1 Jun 2012 | 5:17 PM ET
Fast Money Portfolio
Fast Money Portfolio

It appears that investors are desperate for a safe haven.

On Friday, yields on the 10-year Treasury dropped to 1.442 percent, the lowest level on record, and the records date back to the early 1800s, according to Reuters.

With yields at historic lows, can they really fall a lot farther? According to William Irving, Co-Manager Fidelity Government Income Fund, they can.

“Given the structural problems that Europe faces and the viability of euro as a currency – we’re comfortable owning long duration Treasurys,” he says.

But that doesn't mean rush into the bond market this very second.

“If you look over the past few years when pessimism has been at its highest – that’s when we’ve gotten the most forceful policy responses. In turn, that’s led to relief rallies in equities and sell offs in bonds. We’re probably close to a relief rally and sell off, now," he concedes.

"However, for the long-term the trend is lower yields,” he says.

How Low Are Yields Going?
William Irving, Fidelity, discusses the somewhat rapid decline of Treasury yields. Irving adds he's not worried about a rising yield environment right now.

Posted by CNBC's Lee Brodie




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Trader disclosure: On June 1, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Jon Najarian is long FB CALL SPREADS; Jon Najarian is long DAL CALL SPREADS; Jon Najarian is long JPM CALL SPREADS; Jon Najarian is long GS CALL SPREADS; Jon Najarian is long VIX CALL SPREADS; Jon Najarian is long CIGX; Jon Najarian is long DDMG; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long GLD; Pete Najarian is long AAPL; Pete Najarian is long AAPL CALLS; Pete Najarian is long C; Pete Najarian is long GDX CALLS; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long PEP; Pete Najarian is long FB; Pete Najarian is long JOY; Josh Brown is long COP; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long MO; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long XLU; Steve Grasso is long ZAZA

For William Irving
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For Paul Sankey
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