I still just don’t understand how negative yielding bonds can exist? Why would anyone have to pay for the privilege of lending money to a Government or Business?
These are Bizarro World Bonds!
- YouTube – Elaine discovers Bizarro World
But this seems to be the trend – from FT.COM:
- Japan’s surprise easing spurs on more negative yield bonds
- Corporate bond yields and the cold pull of negativity
Why would anyone buy these bonds? – maybe they won’t:
- ZeroHedge – Here Come The “Unintended Consequences”
Obviously there is a Central Bank induced bubble hiding in here somewhere – but where it ends and at what cost is anyone’s guess:
- Epsilon Theory – Rewardless Risk
Make no mistake, this will be a great short for someone – but shorting bonds for the last few years has been a Widow Maker trade – I am simply not that brave. I am keeping the duration on the bonds in my portfolio as short as possible until this bubble blows.
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