Jefferies' David Zervos on bonds: Good levels for long-term investors to get involved in bond market

• Agrees that oil prices will likely fall sharply once the geopolitical conflict ends.
• Recommends long-term investors consider buying bonds at current yield levels.
• Attributes rising Treasury yields to increasing real rates and anticipated productivity growth, not inflation expectations or Fed credibility issues.
• Highlights AI's role in driving productivity, contributing to strong economic growth despite a stagnant labor market.

Jefferies' David Zervos discusses the current market environment, suggesting that while geopolitical conflicts may impact oil prices, the rise in U.S. Treasury yields is primarily driven by increasing real rates and expectations of significant future productivity growth, particularly from AI. He advises long-term investors to consider buying bonds at current levels, viewing the 'rate hike excitement' as overblown.