"It Feels Like 2008" Government Bond Yields Signal "Something Very Nasty Is Coming"

With global developed market bond yields crashing to record lows and almost $10 trillion of negative-yielding debt worldwide, it is no surprise that money managers are concerned that "it's starting to feel like 2008."

Global developed market bond yields crashed once again to new record lows overnight at just 40.0bps (having plunged from 63bps pre-Brexit)...

 

As negative yields become the new normal around the world. Japan and France are leading the way as demand for the safest assets boosts the amount of global bonds with negative yields to $9.8 trillion, according to Bloomberg World Sovereign Bond Indexes.

 

That’s up from $8.35 trillion before Britain voted to leave the European Union last month. The latest new entrants include Japan’s 20-year bonds, and French nine-year securities, which both saw yields drop below zero for the first time in the past 24 hours.

As John Anderson, a money manager at Smith & Williamson Investment Management in London concluded:

"Government bond yields are telling you something very nasty is about to happen. These property fund suspensions are a worry. I am risk-off at the moment, erring on the side of believing the govvies,"

Certainly seems like ever since Bernanke went back to the money-printing game after QE2 that he broke the stock market's ability to signal anything...

 

Because the days of 'fundamentals' are long gone...

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