With "The Martian" invading big screens worldwide, Wall Street is turning to the film's interplanetary premise as a reference point for another long-term mission: The process of bringing interest rates back to long-term "normal" levels.
"We see a better chance of landing men on Mars before a full normalization of nominal and real interest rates, especially 10-year yields, to historical norms," wrote Deutsche Bank equity strategist David Bianco.
The short-term federal funds rate has been at ultralow levels for nearly seven years, and despite widespread expectations that the Federal Reserve would raise its rate target this year, that is looking increasingly unlikely. Meanwhile, longer-term bond yields have remained markedly low in the U.S. and around much of the world.
Bianco doubts that the 10-year Treasury yield will exceed 3 percent "for the rest of the cycle."
"To make the case for normalization, you'd really have to see rates go significantly higher, just given how much they've trended lower over the past few years," pointed out Oppenheimer technical analyst Ari Wald in a Monday "Trading Nation" segment.
Examining a chart, Wald sees "no real signs that this very long-term secular trend has reversed higher."