Thoughts On The Bond Bubble

Lately there has been much commentary on whether the bond market is in a bubble.  While many believe such a bubble exists, others – including many prominent investors and commentators – disagree. As I have previously written, I believe that there is a bond bubble encompassing the entire bond market.  While for many reasons one … Read moreThoughts On The Bond Bubble

The Corporate Bond Bubble

On August 13 The Wall Street Journal had an article titled “J&J Sets a Yield Low.” From the story: “The health-care products firm sold 10-year bonds with an interest rate of 2.95%, or a risk premium of 0.43 percentage point over comparable Treasurys.” The story provides an overview of the strong market environment for both … Read moreThe Corporate Bond Bubble

The Bond Bubble

On June 8 The Wall Street Journal had an article titled “Bond-Fund Managers See Signs of a Bubble.” While most people wouldn’t think of the bond market as having bubble characteristics, nonetheless such a bubble has developed. The article mentions several vulnerabilities the bond bubble faces.  I would add that a major vulnerability is a … Read moreThe Bond Bubble

Bubbles

from the November 3 FOMC Minutes: “Members noted the possibility that some negative side effects might result from the maintenance of very low short-term interest rates for an extended period, including the possibility that such a policy stance could lead to excessive risk-taking in financial markets or an unanchoring of inflation expectations. While members currently … Read moreBubbles