Peter Boockvar, chief investment officer at OnePoint BFG Wealth Partners, warned that markets are still dealing with the fallout from what he calls the greatest… financial A bubble in history
the Investor Claimed to be universal Association The bear market is far from over, and expect US Treasury yields to eventually retest 5%, a move that could pressure stock valuations and fizzle out the AI-led market rally, according to interview With David Lean Published July 14.
Boockvar said the bond market remains in a long-term bear cycle and he expects Treasury yields to continue rising, perhaps revisiting the 5% level last seen in 2023.
“I think we’re in a bond bear market. I’ve been saying that for years. We’re in a bond bear market. It’s global, it follows the saga, probably the biggest financial bubble in the history of bubbles,” Boockvar said.
According to the investor, higher returns can create significant pressure on… stock Especially in growth-oriented sectors that have benefited from years of low borrowing costs.
Boockvar’s concerns center on the unprecedented period in which global bonds worth about $18 trillion were carrying negative yields, a phenomenon that emerged after years of ultra-loose monetary policy by major central banks.
He has repeatedly described the negative-yielding bond market as the largest dollar bubble ever created, and believes the adjustment process is far from complete.
His forecast comes as government bond yields continue to rise in advanced economies.
It is worth noting that recent market data shows that yields in major sovereign debt markets, including the United States, Japan, Germany, France, and the United Kingdom, are heading towards multi-year highs amid concerns about persistent inflation, growing fiscal deficits, and rising levels of government debt.
Caution about rising AI market
Boockvar also expressed caution about the AI-led market rally, arguing that the investment cycle in generative AI and hyperscaling is losing momentum.
The benefits of spending on artificial intelligence are expected to increasingly shift from companies building infrastructure to companies using artificial intelligence technology.
Despite his cautious stance on parts of the technology sector, Boockvar remains bullish on commodity-related investments, especially energy, agriculture and uranium, as well as declining consumer staples stocks.
His forecast reflects a broader view that higher inflation and higher yields will continue to favor real assets as markets adjust to the end of the era of ultra-cheap money.
