Bond Market on Brink of Collapse Amid Commodity Surge

The bond market is on high alert as commodity prices surge and inflation expectations rise. Oil has reached nearly $100 per barrel, while copper has hit an all-time high. This comes at a time when the Federal Reserve's target of 2% inflation has been surpassed for 65 straight months.

Peter Schiff argues that the bond market will break before the stock market does. He points out that even when oil prices were falling, the Fed's 2% target was already unreachable. With rising inputs and hot PPI and CPI numbers potentially on the horizon, the damage to bonds is likely to come first.

The market is currently pricing in a 60% chance of a rate hike next week, but Peter doesn't think this will happen. He believes that even if it does, the impact would be minimal due to the market's immediate anticipation of the next hike.