Last year when the economy was booming, the Federal Reserve raised short-term interest rates and the yield on the benchmark 10-year Treasury note topped 3% with seemingly nowhere to go but up.
The 10-year Treasury hit its peak yield of 3.23% in November 2018, tumbled to 2.08% early in June and was trading around 2.16% on Tuesday. “The trend towards Baby Boomers retiring is really accelerating,” she continued, leading to a “shift to people who are much more inclined to savings or lower patterns of consumption, so the economy just doesn't have the 'oomph' it used to have.”
This scenario is playing out in Japan, whose population is in rapid decline, and Europe, which, Jones explained, has not completely recovered from the Great Recession. That’s why Japan, Germany, Switzerland, even France, have negative interest rates on some of their bonds as central banks are desperate to get people to spend money rather than save it.
It looks that way. It looked like we broke out of a 30 year downtrend for a few days but then it failed.