Deleveraging

Via Instapundit, this story here.  It says that the economy is deleveraging.  Naturally, I would agree with this as I have written before.  Sure, the way out of this is to not print more money and so forth.  But what tickled me was when it got to this part:

In the process of this, stocks will do poorly.  House prices will fall another 20%. Only Treasury bonds will do well.

Very funny.  In my opinion, bonds are in a bubble.  The Fed has created that bubble by buying bonds as a part of its monetary policy.  Bond yields can't get much lower than where they are now.  If bond yields go up, prices go down.  But that is the only direction they can go besides sideways.  How is that a good investment?   Frankly, I would consider shorting bonds for heaven sake.

Updated: I made a slight error in a sentence above, corrected now.  Bond yields move in opposite direction of price.  Dumb mistake, my bad.

Update 2: That bit about bonds reminds me of the Jim Mora playoffs video.  Just substitute bonds for playoffs and you get my point of view with respect to bonds.