In the world of bonds, when there is bad news and you are buying bonds at a depressed price,
depressed prices affect shorter bonds more than they do longer bonds.
When fund managers were dumping say, Countrywide bonds back when the Mozillo scandal hit the papers , The 3yr bonds were at 14% but the 10yr bonds were at 10% ( thats why I say I should have bought those 10yrs.) Price movement affects a shorter bond more than it does a longer bond. Maturity is part of the equation. So all things being equal if suddenly, all bonds are selling say 10% lower in price, the shorter bond will have the higher yield.
Even today with a positive yield curve... If I were to take 10% off the price of all us Treasuries (steep yield curve)
The 2yr treasury today price = 100 yield 0.25% the 10yr treasury today price 101-7/32 yield 1.86
ok lets say Obama reveals himself as the Anti-Christ and we take 10% off the price of all UST
2yr @ 90 = 5.66% 10yr @ 91-7/32 = 3.046%
I hope this makes sense, didnt mean to confuse anyone.