Something odd is happening in the government bond market: Interest rates are pricing in a debt-deflation cataclysm.
How else can you explain the
fact that the yield on the U.S. 30-year bond hit a record low of 2.4
percent on Wednesday? Or that Japanese and German 10-year yields are
plumbing record lows? Or that five-year yields of bonds issued by
Eurozone safe havens Finland, Germany and Switzerland are in outright
negative territory?
Something is very wrong here.
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