We have been carefully watching the bond market for another bottom in this time frame. After a rally in price from early November to February 1, prices declined into the close Thursday. Most of our closed end municipal bonds held up well into that low. The idea was to have bought them in January, collect the dividends and ride with them through the congestion expected the first six months. Hitting 5% is a sign of too much pessimism about yields which is how a bottom in bond prices occurs.
The bear bond fund TBF registered an island reversal Thursday. TBF moves up as bond prices move down so this was a perfect inverse relation. I expect TBF to fall back to the $21.00 area over the next few months.
Nustar NS is headquartered in San Antonio. It owns thousands of miles of pipelines, many in our Permian Basin. It is in a nice uptrend channel and just bounced above $15.50. And it has a dividend yield of 10%. I rate NS a strong buy.
Nustar NSS is a floating rate bond. It floats with the LIBOR London Interbank overnight rate and about a fixed 6%. So it too is yielding over 10%.
The world, not Team Biden, is coming to realize the era of the electric car is much further away. I would not be surprised to see WTIC finally breaks through the $80 resistance.
The DJIA had a nice Friday, up 367 as I write just before market close. I expect both stock and bond prices to rally now.
Social mood is positive towards stocks and bonds short term. Longer term mass protests in the streets of Mexico and Paris tell a different story. French President Macron told Zelenskyy that even France had to make relations with Germany after WWII, suggesting he should do the same with Putin. Yes, but Germany and Japan never came round to our point of view until we leveled all their major cities. That is hardly the case with Russia now.
