Nobel Prize-winning economist Robert Shiller isn’t getting spooked by rising interest rates or fresh stock market records, at least not yet.

He’s telling investors to stick with stocks and stay away from bonds as the Federal Reserve steps harder on the accelerator.

Treasury bonds are not a good investment right now,” Shiller said Wednesday on CNBC’s “Trading Nation.” He emphasized that a big risk could be a decline in the prices of 10-year Treasury notes.

The Yale University economics professor gave his latest read on the markets as Federal Chair Janet Yellen held her post-interest rate decision news conference. Moments earlier, the Fed decided to raise its short-term interest rate target by a quarter point, as expected. It’s the fourth rate hike since December 2015.

The decision came even though inflation is below the central bank’s target. In reaction to the hike, the 10-year yield hit a low of 2.103 percent, its lowest level since Nov. 10, 2016.

If the Fed Funds rate moves up to 3 percent over the next two years, Shiller said, would bode poorly for Treasurys.

“We may see a decline in the prices of those bonds,” he warned. “Three percent is well above the current 10-year Treasury yield. … I wouldn’t want to pull out of stocks.”

Stocks, which seesawed throughout the day, moved off their lows as the trading day winded down. The Dow closed at a record 21,374.56, but the S&P 500 and Nasdaq saw negative sessions.

Even though Shiller believes investors should keep buying stocks here at home and aboard, he acknowledges that a recession could still come at any time.

“You know recessions always come as a surprise,” said Shiller. “An inverted yield curve is supposed to be a sign of a recession. We don’t have an inverted yield curve now. We don’t see any signs, but it could certainly happen.”

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