From dhenwood at panix.com Sat Jun 26 09:17:31 1999
Life insurance companies buy & hold. But there are plenty
of traders who turn bonds over almost as quickly as stocks.
The average holding period of a 30-year U.S. government
bond is about 30 days.
This is probably a better explaination to the original question: "the bond market" is largely made up of traders (and are thus tuned to price, not yield), "bond holders" are in a sense, the natural hedgers and take the other side of the trade.
It will be interesting to see if, in the event of a significant equity market decline, whether Mom & Pop Day Trader will turn their interest to bonds on eTrade. I can think of all kinds of interesting ways to re-productize bonds for an individual investor that could make this possible ...
/jordan