Wall Street's Staunch Treasury Bull Declares 30-Year Bond Rally Over

Hoisington Investment Management, Wall Street's most steadfast Treasury bull for the past three decades and once the manager of $5 billion, has declared the bond bull market over. It cited structural deficits and heavy corporate borrowing to finance AI, among other factors. The reversal signals the end of the era of low interest rates and low inflation. As public- and private-sector debt climbs, the firm expects the long-run equilibrium inflation rate to rise and investors to demand a higher risk premium, putting significant selling pressure on long-dated bonds.

Hoisington has sharply overhauled its investment strategy. The effective duration of its flagship bond fund plunged from 20.88 years at the end of September 2025 to 4.7 years at the end of March 2026, before being cut further to less than one year on June 30. The firm has nearly eliminated its long-bond holdings. It forecasts that the U.S. long-run equilibrium inflation rate will rise to 3.5%–4.5%, with a risk that it could exceed 5%. That outlook prompted the firm to exit long-dated bonds entirely and move into ultra-short-term defensive assets.