Hopeful consolidation... Crushing defeat... Hopeful consolidation... Crushing defeat.  We've hesitated time and again to endorse too much hope for a top in yields until 20/20 hindsight confirms that top.  Yes, that's a trade-off, but one that looks better and better with each new crushing defeat.  Today is the latest example of new multi-year high yields, 24 hours after many analysts pointed to the yield curve bounce as evidence that the top was probably in for rates. On that note, "we want to believe," but we don't want to act on that belief until the time is right.  This morning's weakness says "it's not right, yet." 

The same pattern has played out in slightly different ways on each of the last three weeks.  A few days of ground-holding or gains create pockets of hope.  The hope is that rates are leveling off and potentially getting ready to do something other than surge catastrophically higher.  But said pockets have been nothing but trouble.

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Today's crushing defeat is special for an unpleasant reason.  These last few bps of weakness make the current selling spree equal in size to the 1994 selling spree--the one that old people were relying on when they told young people "you think this is bad?  Why you shoulda seen 1994!"  Now those old people have to be even older to have lived through anything worse (about 13 years older).

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