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With Fed Versus Bond Bulls, There Is Potential for Lots of Investor Pain

James Bullard, president of St. Louis Federal Reserve

James Bullard, president of St. Louis Federal Reserve

Photographer: Michael Nagle/Bloomberg

James Bullard is delivering a scary message to U.S. bond buyers.

In a nutshell, it goes like this: Investors aren’t taking the Federal Reserve seriously enough that it’s getting ready to raise interest rates. If Bullard, the president of the Federal Reserve Bank of St. Louis, is right and benchmark borrowing costs really are going up as soon as midyear, there could be some pain ahead in the bond market.