Fixed-income prices continued to slump throughout most of the week. Yields on money market securities and longer coupon maturities climbed towards to peak levels. This movement occurred in the face of weak economic figures, declining money supply, hopeful signs concerning inflation, the plunging price of gold, falling commodity prices, and a strong performance by the U.S. dollar against currencies of other nations.

The problem lies with certain technical factors even though fundamentals continue to improve: too much supply, too much inventory and too few buyers and Federal funds rate trading around the 20 percent level.

All eyes are focusing on Tuesday's meeting of the Federal Open Market Committee that decides the Fed's current monetary policy. The feeling is that any near-term aid to the market will have to come from the Fed, providing banks with more reserves and allowing credit to be more available at a cheaper cost.

Most observers quickly add that any provision of reserves will be modest, because the central bank does not care to see short rates plummet. This would mean that we should continue to see higher short-term rates than longer rates for a minimum of several months.

All in all, this is not a good time for the bond market. The buyers are in the driver's seat and can afford to wait and purchase bonds at near record levels once again.

Treasuries returning yields above 14 percent are available through the five-year maturities. Quality tax exempts are returning 9 percent in the three-and four-year area.