We know that bond prices drop whenever interest rates go up or there is a specter of upcoming inflation; whenever cycles appear in the corporate bond market or the economy.
But that does not mean you should avoid or sell your bonds and run for the hills.
The financial media always takes these symptoms as a cue to get out of bonds or an excuse for buying I Treasury bonds or TIPS, the so-called protection against inflation.
I have constantly commented on this subject, advising how to wisely use DURATION as a tool for overcoming and actually profiting from inflation, using corporate bonds. ( See the Earl J Weinreb NewsHole® comments.)
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