Thursday, February 4, 2010

Taleb Says ‘Every Human’ Should Short U.S. Treasuries

I have seen recommendations before, but none as colourful as this one from Nassim Nicholas Taleb.

Taleb said “every single human being” should bet U.S. Treasury bonds will decline, citing the policies of Fed chairman Bernanke and the Obama administration, according to Bloomberg.

It’s “a no brainer” to sell short Treasuries, Taleb at a conference in Moscow today. “Every single human being should have that trade.”

“Democracies can’t handle austerity measures very well,” Taleb added. “We’re going to have a severe problem.”

He's right. My just a little less colorful way of explaining the situation is that, over the next decade you can make a career out of shorting the bond market.

1 comment:

  1. Robert, what's the best way for an individual investor to short treasuries? There's a newish ETF (TBT) to do this but the short ETFs tend to be inefficient over the long run. Like any bubble, you never know how long you will have to wait before the US debt bubble bursts. The stock market may well tank in 2010 and trigger another "flight to safety".