JPMorgan's Jamie Dimon made bearish call on treasury bond market. Many investors already acted on it

JPMorgan CEO Jamie Dimon warned this week that long-term Treasuries are not a good buy, even in the event of a stock market decline. The call arrives after investors have already rotated away from traditional safe-haven allocations in 2024, defying the usual playbook of moving to bonds during equity weakness.

Dimon's stance challenges the conventional "flight to safety" trade that typically sends money into U.S. Treasuries when stock volatility rises. The iShares 20+ Year Treasury Bond ETF (TLT), which tracks long-duration government debt, has reflected this shift as investors reassess the risk-reward profile of longer-dated paper.

The bearish view on long Treasuries comes as yields remain elevated and rate-cut expectations have moderated. Investors who historically used TLT and similar instruments as portfolio hedges during equity drawdowns are now questioning whether duration risk outweighs the defensive benefits, particularly with persistent inflation concerns and the Federal Reserve holding rates higher for longer.