Gary Shilling, Dan Fuss, Jeffrey Gundlach on Treasuries (Dec/2010, TNX, TYX Charts)

Bond Forecast Arbitrage: Jeffrey Gundlach of DoubleLine Funds thinks it is time to buy bonds (not stocks) on upside yield exhaustion. From Reuters on 12/14/2010:
He said the rapid rate rise will hit "exhaustion" in the weeks to come and that investors should now purchase Treasuries and bond funds.

"I don't think the economy can take much of a rate rise above 3.5 percent," Gundlach said on a conference call with investors.

Also see Gundlach's bearish December presentation "Independence Day" at (12/14/2010).

Dan Fuss of Loomis Sayles bought the 30-year bond at 4.61%, thinks fair value is 4.2%, but believes the 30 year secular bull market in Treasuries is over (Reuters: Loomis' Fuss bought 30-year Treasuries at 4.61 pct, 12/20/2010). Hat tip Jennifer Ablan.

Gary Shilling is still sticking with his 3% call on the 30-year bond. See him debate with Brian Wesbury (who sees 5% $TYX) on the CNBC video below. I also drew the long term downtrend in yields. I agree that yields are in the process of bottoming out, but when does the 30y yield officially break that descending structure? David Rosenberg of Gluskin Sheff on where the 10-year bond bases out:
"I’m kind of thinking that the secular bull market in bonds will be a basing period of rolling lows near the 2% level on the 10-year Treasury note yield." (Business Insider, 12/15/2010)

$TNX 10 Year Treasury Yield Index 3.349

$TYX 30 Year Treasury Yield Index 4.598

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