Kass: Bonds May No Longer Rule

This blog post originally appeared on RealMoney Silver on Nov. 6 at 7:52 a.m. EST.

After yesterday's convulsive and disorderly $8.50 increase in the price of the 30-year U.S. Treasury bond, a once-in-a-generation short opportunity might now be occurring in the fixed-income markets. My experience is that the magnitude of Thursday's price rise is the sort of occurrence that ends an asset class's move.

I have initiated an iShares 20+ Year Treasury Bond Fund (TLT Quote) short ($105) over the last two days. It is the essence of the anti-implosion trade and a statement that, among other things, oil will not remain under $50 a barrel and that, at some point in the near future, order will return to the world's markets.

I may very well be early -- I usually am! -- as the weight of the deflationary forces are overwhelming nearly every market, but I have almost always found that my best investment ideas are contrarian and not herd-following (and, again, are often early). ...