https://www.nasdaq.com/article/rates-and-reality-series-was-the-great-bond-bull-market-just-plain-bull-cm1082532One comment you often hear these days is how lucky bond market investors have been. Interest rates have been falling for decades, and this has led to a huge bull market for bonds. This is the conventional wisdom that everyone has embraced: falling interest rates are good for investors, and rising rates are bad. The reasoning is straightforward bond math. If interest rates fall then yes, the price of your bond will go up. And vice versa: if interest rates rise then bond prices will fall. Many observers apply the same math to the so-called great bond bull market-the 30-year decline in bond yields beginning in 1981. The assumption is that bond investors have been making out like bandits for decades. And now with interest rates on the way back up, it stands to reason that the bounty has dried up. No more good returns for you bond investors. From here on out it will just be declining prices, doom and gloom. Here's the problem with this story: there never was a bond bull market. Those three decades were largely a bad period for bond investors.
