Title: Haymaker Daily — What's That Old Saying About Those Who Ignore History?
Show: Haymaker (Substack, paid post)
Author: David Hay / The Haymaker Team
Date: 2026-09-15 (SEP 15, 2026 — byline date on the post page)
URL: https://haymaker.substack.com/p/haymaker-daily-5e3
Length: written post — no timestamps
Note: Written post — no timestamps; text verbatim from the paid post (captured via Stephen's logged-in Chrome session). Two charts are not reproduced — chart titles and legible readings noted in brackets. Disclosures omitted.

Hello, Haymakers – Take Warning:

This newsletter, as well as its predecessor, has been consistently bearish on long-term U.S. Treasury bonds and notes since the summer of 2020. That was when the yield on the 10-Year U.S. T-note briefly hit 0.5%, i.e., one-half of one percent. Today, it is at 5%, a tenfold increase.

Yet, despite this radical rate rise, the S&P 500 has returned 16% per year since July 31st, 2020, far above the 9% to 10% annualized gain, including dividends, it has generated over the very long run. (As an interesting, and perhaps relevant, footnote, using 1927 as the starting point, when tracking of the S&P first began, the actual total return has been much lower at 6.75%; undoubtedly, this reflects the great stock market crash of 1929 and the subsequent devastating bear market that lasted until 1932.)

Typically, severe bond bear markets act as a powerful headwind on stock prices. Accordingly, the results of the last six years are highly unusual. However, they are not totally without precedent. From the summer of 1986 until late October of 1987, long-term U.S. Treasury yields erupted from 7.2% to 10%. Yet, from August of 1986 through September of 1987, the S&P 500 vaulted by nearly 40%. Of course, what happened next is the stuff of Wall Street legends… or nightmares.

[Chart: Bloomberg Total Return Analysis, SPX Index, 09/30/1987 – 11/30/1987 — price change -28.44% (dividends reinvested -27.98%) over the 61-day holding period; index from ~328 at the end of September to ~225 at the October 19 low, 230.30 at November 30]

Ironically, the significant performance divergence back then didn't create one of the biggest spikes on the chart shown below. As you can see, those, such as in the late 1990s, were far more dramatic. (It is noteworthy that this episode also led to the punishing bear market of 2000 to 2003.)

[Chart: "Chart 5: Average Annualized Relative Total Return of U.S. Stocks above U.S. Bonds, Trailing 76-Month Periods Since 1926" — data sources Ibbotson & Bloomberg; PaulsenPerspectives.Substack.com. Labelled peaks: 1939 (~18%), 1956 (~25%), 1969 (~14%), 1981 (~14.5%), 1999 (~16%); 1933 trough; latest reading ~28% marked "???" — the highest in the series. Sources: Jim Paulsen and Jesse Felder]

Clearly, there's never been such a pronounced performance gap between stocks and bonds. The always cheery consensus is hopeful that this is due to strong economic growth and the seemingly limitless potential of AI. That could be true, but with both interest rates and oil prices soaring, we continue to believe cash is definitely not trash.

The Haymaker Team