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Are Treasuries the real deal?

The yield on 10-year US Treasuries fleetingly dipped below 1.7% last week – its lowest level on record. We do not expect to witness a major sell-off any time soon – our end-2012 and end-2013 forecasts for the 10-year yield are both 2%. However, we do think the great bull market of the past thirty years is on borrowed time.

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