Welcome to Animal Spirits, the podcast that takes a completely different look at markets and investing,

hosted by Michael Bannick and Ben Carlson, two guys who study the markets as a passion,

and invest for all the right reasons.

Michael Batnik and Ben Carlson work for Ritholz Wealth Management.

All opinions expressed by Michael and Ben or any podcast guests are solely their own opinions

and do not reflect the opinion of

Ritt Holt's wealth management. This podcast is for informational purposes only and

should not be relied upon for investment decisions. Clients of Ritthold's

wealth management may maintain positions in the securities discussed in this podcast.

Welcome to Animal Spirits with Michael and Ben. So we are in the back half of the year almost 10 months through and

bonds are down. Long dated bonds are down 6%

intermediate is down 3% and the index is down roughly 2%

talking about total returns so including

including interest now obviously it's not a big deal if your bond is down 2% but for

some reason people get really uncomfortable when their bonds go down.

They probably wrongly think that it's a money market and that they should never see declines,

not just in price, which they're going to see, but in total return also. But the thing is if you are in a diversified

portfolio, well stocks have done really, really well this year. The SSP 500 is up around 10%. And you've

written about this in the past that people think about the fact that

bonds diversify stocks but it works the other way where stocks diversify bonds as

well. Yeah that's the point and bonds have kind of lagged for a number of years and I saw

stat the other day that said over the last like three year period, it's one of the worst that the Barclay's ag has ever seen because it only goes back to the mid 1970s and so it's up like 1% a year and bond investors for the last three or four decades

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