By Seeking Profits:
Thus far, 2014 has been a strange year for the bond market. With the Federal Reserve tapering its bond purchases and consensus that the economy would improve, it was widely assumed that interest rates simply had to rise from record lows. Instead, the 10 year yield has actually declined this year and has been bouncing around 2.6% compared to 3% several months ago. This move has surprised many and forced covering of shorts in the fixed income space.