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After three months of declines, markets rebounded strongly in November. I had expected continued weakness but a big inflection point occurred on November 1st when the Fed decided to hold interest rates steady for a second month in a row. An unchanged CPI read for October provided further fuel for the rally.
In this environment, Bond King Bill Gross indicated that he is now positioning for yield curve disinversion where short-term bonds like the 2-year treasury notes go back to yielding less than long-term bonds like 10-year treasury notes.