How to “Front-Run” the Next Bond Rally (With 8.7% Dividends)

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How to “Front-Run” the Next Bond Rally (With 8.7% Dividends)

Let me start with a prediction: Interest rates are going to fall this year—and by more than most people think.

When that happens, bonds—including one discounted 8.7%-paying bond fund we’ll get into shortly—are poised to head skyward.

Rates down, bonds up. That’s the law of Bond-land. It’s a simple fact that a lot of people, hopelessly caught up in the “tariffs cause inflation” storyline, are missing.

Bessent (and Trump) Go Over Jay Powell’s Head

Forget about the Fed standing pat on rates last week. Forget about Jay Powell saying he’s waiting for more clarity on the Trump administration’s policies before setting the ultimate direction of rates.… Read more

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This “Tariff-Proof” 10.4% Dividend Will Shine in 2025

Contrarians that we are, we know when we hear things that sound like “common wisdom,” we need to look just a little bit deeper.

Today, that’s what we’re going to do, with a common refrain we’re hearing a lot—that tariffs will lead to a spike in interest rates.

Then we’ll look at a bond play that’s set to benefit from this misunderstood mantra. This smartly run fund pays a dividend that yields 10.4% and comes our way monthly, too.

Tariffs Here, Tariffs There …

To be sure, tariffs have arrived. President Trump has imposed a 10% levy on all products China exports to the US (and 15% on liquefied natural gas and certain types of coal), effective last Tuesday.… Read more

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This 8.8% Divvie Is the Perfect Contrarian Play on Inflation

Trump 2.0 has exploded out of the gate, and we’re quickly lining up the best bond buys in response—including an 8.8% payer we’ll dive into below.

“Bond Vigilantes” May Return (But We’re Not Waiting Around)

“Wait, we’re buying bonds now?” you might be thinking. “Aren’t inflation and rates going to tick higher in the new administration?”

It’s a reasonable question. And yes, when rates go up, bonds go down. That’s just the way it works in bond-land.

Tariffs are on the way. Ditto mass deportations. And last I checked, the federal government was running a $2-trillion deficit. (And let’s be honest, DOGE or no, politicians are in no hurry to take that problem on.)… Read more

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My 5 Favorite CEFs for 2025 with Yields Up to 13.7%

Are higher interest rates and lower bond prices a sure thing for 2025? Mainstream financial pundits say yes.

Which gives us thoughtful contrarians pause. Their narrative against bonds is assumed. When this happens, markets tend to move in the opposite direction of conventional wisdom.

Which means we should bet with bonds. At least in the near term to start the new year. Let’s watch bonds rally and surprise everyone except for us. The “Trump is bad for bonds” trade may eventually be correct, but my hunch again is that this “surefire” call is early.

For all the recent commotion, the 10-year Treasury yield bounces between 3.3% and 5%, with an even narrower 3.6% to 4.7% range recently.… Read more

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My 5 Favorite CEFs for 2025 with Yields Up to 13.7%

Are higher interest rates and lower bond prices a sure thing for 2025? Mainstream financial pundits say yes.

Which gives us thoughtful contrarians pause. Their narrative against bonds is assumed. When this happens, markets tend to move in the opposite direction of conventional wisdom.

Which means we should bet with bonds. At least in the near term to start the new year. Let’s watch bonds rally and surprise everyone except for us. The “Trump is bad for bonds” trade may eventually be correct, but my hunch again is that this “surefire” call is early.

For all the recent commotion, the 10-year Treasury yield bounces between 3.3% and 5%, with an even narrower 3.6% to 4.7% range recently.… Read more

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This 10.4% Dividend Is Our Top Contrarian Play on “Trump 2.0”

Most people think inflation will rise in a second Trump term—we can see it in the jump in 10-year Treasury rates over the last few weeks.

But that trade is getting just a little bit crowded—and we contrarians are going to take advantage of that with a 10.4%-yielding closed-end fund (CEF) that’s come back to earth as a result.

This situation reminds me a little of October 2023, when investors were also betting on “inflation forever.” We didn’t buy it then, either. Instead I named the DoubleLine Yield Opportunities Fund (DLY), payer of a 9.5% yield at the time, as one of the top portfolio buys in my Contrarian Income Report service.… Read more

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Election Winner? This Elite 8.7% Bond Fund

The Federal Reserve cut interest rates by an “historic” 50 basis points. Then, interest rates soared.

Wait. What?

The Federal Funds Rate is a target (technically a target range) that influences short-term rates in the economy. Money market funds, for example, pay interest based on this benchmark. They pay 0.5% less today than two months ago due to the Fed cut.

Long-term rates, on the other hand, are not controlled by the Fed. Not directly, at least. The global bond market is a cool $130 trillion. Far too large for anyone, even Uncle Sam, to control.

Hence the recent fixed-income paradox.… Read more

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The Best Bonds to Buy for a Recession

One year ago, I wrote to you that it was time to buy bonds again. The “index huggers” who only know SPY thought we were nuts for talking fixed income.

The popular narrative at the time (which aged like boxed wine) was that interest rates would rocket to the moon in order to contain inflation. Or help the government fund its ballooning deficit. Or some line of reasoning.

When rates rise, bond prices fall. Hence, the prevailing vanilla sentiment was that bonds were for bums.

We original thinkers disagreed. We reasoned—correctly—that rates fall when recession fears grow. Period.… Read more

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Sayonara, SPY. And Hello, Recession-Resistant Monthly Divvies.

Well the “index huggers” hurled their positions quickly, didn’t they! Some bad jobs numbers. A rally in the Japanese yen. And it was sayonara, SPY.

The financial “squares” use blunt instruments. When they panic, they dump the only ETF they own. Turns out they were all short the Japanese yen heading into the weekend!

When the margin call came, they sold the only ticker they own: SPDR S&P 500 ETF Trust (SPY).

I warned you about SPY three weeks ago, just before it crashed. My problem with SPY came down to three stocks, Apple (AAPL), Nvidia (NVDA) and Microsoft (MSFT), which made up 21% of the index—and still do!… Read more

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11 Simple Rules for 10%+ Dividends with Safe CEFs

If you don’t like these 8%, 9% and even 10%+ dividends, well, you’re not really an income investor.

That’s right. As I write, select closed-end funds (CEFs) yield 10.6%.

Ten. Point. Six. Per. Cent!

We contrarians are locking in yields up to nearly 11%. Here’s how, broken down in an 11-step playbook for these 8%, 9%, even 10.6% yields.

CEF Rule #1: Buy the Best 

Fixed-income behemoth DoubleLine runs some well-known big mutual funds and ETFs as well as smaller, lesser-known CEFs. There’s a raging dividend party in the ignored CEF corner of DoubleLine’s portfolio, with yields up to 10.6% via DoubleLine Income Solutions Fund (DSL).… Read more

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