investing

Best and worst investment ideas for 2014

Worst investment ideas: Long-term Treasury bonds?
Worst investment ideas: Long-term Treasury bonds? © Richard Cavalleri/Shutterstock.com

Yes, you found this asset class in the "best investment ideas" category, but not everyone agrees. Stanasolovich and Ghriskey both disparage bonds. "With an accelerating, or perhaps even status quo, economy, bonds -- especially long government bonds -- are the wrong place to be," Ghriskey says.

"The economy would push up interest rates. With the economy strong, the Fed will taper (curb its bond buying), and speculation will arise that the Fed will eventually raise rates. That will certainly be a negative scenario."

"Long-term Treasury bonds will be an ugly asset class," says Stanasolovich. With current yields so low, foreign investors will stay away from the market, he says. "That's happening already."

To be sure, if the Fed lessens or ends its bond purchases, the economy will probably end up in a recession, pushing bond prices higher temporarily, Stanasolovich says. "But in the long run, as the economy stabilizes, you will see long-term Treasuries perform poorly," he says.

advertisement

          Connect with us
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

CDs and Investment

Fed up with low savings rates?

Dear Dr. Don, At 85, my aging mother is earning just 0.4 percent at her bank in a one-year certificate of deposit. She has more than the maximum amount insured by the Federal Deposit Insurance Corp. in one bank account... Read more

advertisement

Blog

Dr Don Taylor

The Fed’s stock valuation issue

The Fed's Monetary Policy Report on stretched valuations in certain sectors moves markets.  ... Read more

Partner Center
advertisement

Connect with us