Although many investors are fleeing bonds in expectations that rising interest rates will send bond prices down, Pimco Executive Vice President Tony Crescenzi makes a bullish case for bonds.

Long-term bond rates will rise as the Federal Reserve tapers its quantitative easing (QE) stimulus, but short-term rates will remain low, Crescenzi tells CNBC.

"The Fed is losing its grip on longer rates. Short rates it controls, and it will control them until a rate hike is near, and that's somewhere in 2015 — probably the latter half given what the Fed told us."

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The Fed prepared markets for rising long-term rates in May when it said it would soon start reducing its bond purchases. As it turned out, the central bank delayed its taper decision until this month, announcing that it would shrink the monthly bond purchases from $85 billion to $75 billion.

"There is momentum in the economy that will scare bond investors as the year goes on," he predicts.

The 10-year Treasury yield should remain below 4 percent, specifically between 2.75 to 3.25 percent, next year because the economy has momentum that people are banking on," he states.

While that momentum will plush up bond rates to new highs, it won't reach "a meaningful high," he adds, forecasting a "normalization for rates."

There's been a "huge shift in positions already," he notes.

Investors pulled a record $77.5 billion from bond funds in 2013, data from research firm TrimTabs indicate, according to CNNMoney. However, rates remained low and the bond bubble that many experts had predicted never materialized.

Bond yields moved little when the Fed announced its plan to cut QE by $10 billion, a sign that markets have already price the reduction.

"We already went through this drill once," Matt Freund, a fund manager for USAA, tells CNNMoney, referring to May when speculation about the Fed's taper caused yields to spike. "The markets are a quick study."

Chris Gunster, head of fixed income portfolio management for U.S. Trust, predicts bonds will behave more like a gradually deflating balloon rather than a bubble. "Bubbles tend to burst. Balloons just tend to glide down."

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