In this episode of The Glass Half Full, Ryan Detrick, Chief Market Strategist at Carson Group, and Sonu Varghese, Chief Macro Strategist at Carson Group, dig into one of the most overlooked stories in today’s market: bond yields are rising sharply, and every investor with a portfolio needs to understand why.
The numbers tell the story. The 10-year Treasury yield has jumped from 3.94% to 4.60% since the war in Iran began. The 30-year yield has broken above 5% for the first time since 2007. Bond prices are negative on the year, while stocks, emerging markets, and even gold are sitting in the green. For investors who have long counted on bonds to zig when stocks zag, this environment is forcing a real rethink.
Sonu explains the core dynamic: Bonds don’t just dislike inflation, they especially dislike inflation volatility. With the Strait of Hormuz still shut, oil above $100, and global supply chains under pressure, inflation is not only elevated but unpredictable. That uncertainty is exactly what pushes yields higher and bond prices lower, and it is playing out across every major bond market around the world.
Ryan and Sonu also make the case for rethinking the classic 60/40 portfolio. In a world of inflationary growth, the traditional 40% bond allocation may no longer be doing the job it was designed to do. The diversifiers that have held up—cash, gold, and managed futures with exposure to commodities—are the ones worth owning alongside stocks in this kind of environment.
The episode closes on a note of measured optimism. The economy is holding up, earnings remain strong, and the market just completed one of the strongest seven-week win streaks in history. Some volatility from here would be normal and healthy. The bull market case remains intact, even with bonds shaken and stirred.
Key Takeaways
- The 10-year Treasury yield has surged from 3.94% to 4.60% since the war began, and the 30-year yield is at its highest level since 2007.
- Bonds dislike inflation, but they especially dislike inflation volatility, and with oil above $100 and the Strait of Hormuz closed, that volatility is running high.
- S. bonds are negative on the year while stocks, emerging markets, and gold remain in positive territory, challenging the traditional diversification role bonds are supposed to play.
- The classic 60/40 portfolio may need an upgrade—cash, gold, and managed futures have served as more effective diversifiers in the current inflationary growth environment.
Jump to:
0:00 — Welcome And Bonds Get Exciting
0:45 — The Yield Jump Across the Curve
2:05 — Inflation Volatility and Oil Shock
3:40 — Why Bonds Are Down Year to Date
5:25 — Rethinking 60/40 For Inflation
7:05 — Diversifying Diversifiers: Cash, Gold & Futures
8:55 — Higher Yields for Borrowers and Savers
10:20 — New Fed Chair and Rate Hike Odds
11:55 — Stock Rally History and What’s Next
13:25 — Closing Thoughts and Graduation Season
Connect with Ryan:
- LinkedIn: Ryan Detrick
- X: @ryandetrick
Connect with Sonu:
- LinkedIn: Sonu Varghese
- X: @sonusvarghese
The views stated in this podcast are not necessarily the opinion of Cetera Wealth Services, LLC, or CWM, LLC. and should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein. Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.
Ryan Detrick and Sonu Varghese are non-registered associates of Cetera Wealth Services LLC.
A diversified portfolio does not assure a profit or protect against loss in a declining market.
Please note: Cetera Wealth Services, LLC is not registered to offer direct investments into commodities or futures. Instead, we provide access to this asset class via mutual funds, exchange-traded funds (ETFs) and the stocks of associated companies. Investments in commodities may be affected by the overall market movements, changes in interest rates and other factors such as weather, disease, embargoes and international economic and political developments. Commodities are volatile investments and should form only a small part of a diversified portfolio. An investment in commodities may not be suitable for all investors.
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