Economic data have been reasonably good, so the bonds continue to sell off. Strong economic growth means the central bank is likely to tighten further. You see significant back-up in yields across the board.

There's still more room to run.

Bonds are a little bit expensive right now. Consumers are spending a little bit aggressively, which may make the central bank nervous about rising prices. It may push the bank to tighten further.

The statement opened up the possibility that the interest rate going to 4 percent isn't 100 percent guaranteed.

Usually when the public gets admitted to something, it's the end of the bubble. The exponential growth in private equity and hedge funds in the last decade is mind-boggling. There's a bubble here that's going to bust. There's too much money. That's true in venture capital and it's true of hedge funds as well.

Construction spending remains strong due to continued economic growth.