Dimon Won't Buy Long Treasuries; Investors Already Piled Into SGOV
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- Jamie Dimon told CNBC he wouldn't buy long-dated treasuries, saying "The 10-year bond should probably be at 4% to 4.5%" even if inflation falls back to the Fed's 2% target
- The 10-year Treasury yields 4.6% currently, with the yield rising for most of the year as the market repriced from expecting Fed rate cuts to pricing in a possible rate hike, alongside concerns over public spending and deficits
- SGOV (iShares 0-3 Month Treasury Bond ETF) took in $47.5 billion in net inflows this year — more than any other bond ETF — and grew to roughly $100 billion in assets, making it the third-largest bond ETF behind only BND and AGG
- SGOV ranked No. 5 among all ETFs in June flows, showing the short-term Treasury momentum extended through mid-year rather than fading
- Warren Buffett endorsed the same short-duration playbook in his 2013 Berkshire Hathaway annual letter, recommending a 90% S&P 500 and 10% short-term treasuries split for his wife's estate plan
Why it matters: Dimon's bearish call on long-dated Treasuries echoes a positioning trade investors have already executed at scale: $47.5 billion has flowed into SGOV this year, betting the 10-year's 4.6% yield doesn't compensate for inflation, deficit, and rate-hike risk. The source notes 10-year prices should remain under pressure as long as rate-hike risk persists.
