The Fed Won't Ruin Bond Markets

History shows that rate hikes rarely trigger panic.

"I come in peace, bond investors."

Photographer: Andrew Harrer/Bloomberg

With the Federal Reserve poised to unleash its first interest rate increase in almost a decade there's a debate among investors about whether the past is any guide to how markets will react to a monetary tightening. The to-and-fro brings to mind automobile entrepreneur Henry Ford's famous insistence that "history is more or less bunk." But traders might be better served to recall a quote attributed to Mark Twain -- that even if history doesn't repeat itself, it does rhyme.

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