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Michael Kao, CIO at Akadia Capital, cautioned that while many are concerned about yields returning to pre-GFC levels, a significant drop in rates could be tied to an economic and market downturn.
Kao advised people to be mindful of what they wish for regarding interest rate movements, suggesting that a desirable rate environment may come with unwanted consequences.
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Kao recently commented that TLT showed signs of a capitulation bottom after a period of perceived overselling. He also observed heightened market volatility following the breakdown of the TLT double-bottom on October 7, 2026. These earlier views add context to his current warnings on interest rate movements.