Here’s the bond-market alternative as U.S. and other developed markets debt deteriorate

Christopher Wood of Jefferies argues that Group of Seven government bonds have been in a "structural bear market" since March 2020 — a period when yields broadly rose and prices fell as the pandemic-era rally reversed. The framing matters because it suggests the pressure on developed-market debt may reflect deeper forces rather than a temporary swing.

The backdrop includes heavy government borrowing, sticky inflation in some economies, and questions about how far central banks will cut rates. When bond prices fall, yields rise, which raises the cost of borrowing across mortgages, corporate credit, and government refinancing.

For investors, the practical question is what serves as an alternative when traditional developed-market sovereign debt offers less cushion. Possible substitutes include cash and money-market instruments, inflation-linked bonds, shorter-duration credit, and selected emerging-market debt — though each carries its own risks, from reinvestment risk to currency and default exposure.

What to watch: whether yields stabilize or keep climbing, how central banks frame rate policy, and whether demand holds at government debt auctions. Those signals will shape how durable this "structural bear market" proves to be.