We had no sooner spoken of perhaps buying puts on the bonds (TLT bond etf, TBT short bond etf) that the WSJ published a squibb yesterday that someone came into the options market and bought 30,000 calls on the TBT (effectively a put on the T bond.)
10 cents will get you $10 that this is Taleb dreaming of black swans. It is a way to play it. but he’s only got (we think) 36 or 37 days for his bet to pay off. We think there is a distinct possibility that the bonds will break in this time but whatever you do in this market is playing with fire. We are thinking about the TBT calls right now and will comment soon.