Earlier today, Black Swan author Nassim Taleb’s appeared on CNBC. His key takeaway quote: “I own stocks because I don’t trust Treasury bond.” This got the financial bloggers all a-twitter
Peak Taleb, Feb 2010 bloom.bg/w9Twob
— Cardiff Garcia (@CardiffGarcia) March 13, 2012
The Bloomberg article dated February 2010 is titled Taleb Says ‘Every Human’ Should Short U.S. Treasuries and it speaks for itself. From the article:
It’s “a no brainer” to sell short Treasuries, Taleb, a principal at Universa Investments LP in Santa Monica, California, said at a conference in Moscow today. “Every single human being should have that trade.”
Taleb said investors should bet on a rise in long-term U.S. Treasury yields, which move inversely to prices, as long as Bernanke and White House economic adviser Lawrence Summers are in office, without being more specific.
Here’s a look at how the 10-year Treasury Note yield performed since Taleb advised “every single human being” to short Treasuries. Basically, if you followed Taleb’s advice, you’d be toast.