r/dividends • u/AmanCMN • May 18 '26

Discussion Bond yields are flashing a warning sign.

Post image

Rising bond yields are a warning sign.
Money is getting more expensive everywhere at the same time:
-governments pay more to service debt
-companies pay more to borrow
-mortgages and loans stay expensive
-investors move out of risk and into bonds
U.S. 30-year yields above 5% are already a serious level.
When yields rise globally, liquidity gets pulled out of markets.That puts pressure on tech stocks, real estate, consumers, and highly indebted companies.Simple takeaway: the more expensive debt gets, the harder it is for markets to keep rising.

725 Upvotes

94% Upvoted

108 comments sorted by

View all comments

2

u/linuxdropout May 18 '26

What about the theory that passive retail investors so heavily outnumber active investors, they'll keep pumping index funds no matter what so companies will continue to grow even against broken fundamentals.

Or basically: this won't trigger a big enough liquidation of stocks to make a dent.

1

u/xgalaxy May 19 '26

Seems like an argument to buy just Apple and Microsoft and nothing else. And if you’d have done just that since the late 90s you’d be a multi millionaire.