The 10-year T-note broke below 4 percent for the first time since last fall, but could not hold; mortgages had a couple of days at 5.5 percent but are now back to 5.625 percent. Nothing in economic data accounts for continuously low long-term rates. The stock market is a little shaky, earnings nervous-making, which helps, but claims for unemployment insurance have fallen to the lowest levels in five years. The Fed is going at least another .5 percent to 3 percent by May, and 3.5 percent by August is a better bet. The only way a tightening Fed helps bonds is by creating the hope that it will mash the economy by accident, and the economy is too healthy for that. Nothing on the political front is a help to bonds. President Bush's new budget is either a flinch from the dangers of really d...
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