An important thing to note is that through all the fed easing's (450bps) longer term rates have not really budged (over the last year). As was posted above about 150 of tightening is priced in for the rest of the year (check out euro dollar futures contracts). Its not clear how this will effect long rates. I think inflation is the real worry for longer maturity paper - but supposedly the market feels an active fed can control this.


One interesting trade (hinted at in the above thread) is to buy corporate bonds but hedge away the interest rate risk - perhaps using swaps - good luck with it all.