We are in the early stages of a bond bear market but it remains for now a modest, shallow and unthreatening one. We have grilled our Fixed Income managers as to the terminal US yield for this cycle and the great and good of Fidelity, Artemis, Standard Life, Jupiter and JPM are of the opinion that, though the direction of travel remains upwards for the foreseeable future, the high point of the cycle for the 10 year US treasury will only be around 3.5%, way below the usual double digit peaks of previous cycles. The 3 Ds (debt, disruptive technology, demographics) are huge structural trends that should keep bond yields much lower than in previous cycle. The peak of improving economic momentum is now probably behind us leaving economic growth solid but not incendiary and inflation still muted even at this late stage of the economic cycle. This too would imply that even though the Fed will keep raising the base rate, the long-end of the curve has already seen much of its likely move. If the boffins are right, then the Fixed Income market is beginning to offer some value again without a huge amount of downside risk.