Posted by Davy Bui on December 27th, 2007 in Market Commentary, Pundits
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Scott Minor (sp?), CIO of Guggenheim Partners, appeared on Bloomberg’s Final Word program today talking about interest rates. According to him, once the Fed gets the 10-year note down to 2.5%, the housing market will see buyers coming back to the table.

Now I don’t disagree that 2.5% long-term rates will bring buyers back (including myself) but how the hell is the 10-year Treasury rate going to get to 2.5% without serious knock-on ramifications? According to Guggenheim guy, apparently the market will just keep buying sub-3% yield long bonds, even with inflation raging for all to see.

Maybe Wall Street has a magic wand — you know, the same one that guarantees 30% earnings growth for decades on end, turns around businesses with a wish and a whisper, and makes all investments low-risk, high-return no-brainers.

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UPDATE:

A reader sent in some more information on Scott Minerd:

http://www.milkeninstitute.org/events/gcprogram.taf?function=bio&EventID=GC06&SPID=1971

Impressive bio.