Tuesday, 5 June 2012

Treasury Bonds are Essentially a Speculative Asset - Hussman

The always thought provoking John Hussman characterises Treasuries as a speculative asset as rates reach for the zero bound at long maturities.

Where else to turn for safety? Does Gold's turn come as the risk of loss in treasuries increases?

Egan Jones downgrade the UK - maybe government debt isn't so safe, even when you have your own currency? The disproportionate financial sector still carries enormous debts which elevate sovereign risks.

The UK seek to reduce the rate of inflation factored into inflation protected Gilts. Financial Repression continues, don't look for inflation protection in inflation linked bonds where the inflation rate can be re-calculated.

And to confirm that QE is a great thing the Bank of England made a profit last time...! As interest rates have been driven down the capital value has increased.....of course realising a profit involves selling them all ...!

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