Bubbles are created from mass hysteria and delusion, not greed specifically. The reason the bond bubble is going to be so bad stems from the fact that the purchase is falsely assumed to be a safe, non-speculative position to take. The government can’t subsidize risk out of the markets very long, and interest rates are … Read more Bond Bubble?
Bill Gross has the same silly smile on his face that Angelo Mozilo had at the peak of the real estate bubble. That should tell you something about the bond market.
These people don’t even know what they are trying to fix. The free markets just let the larger commercial and investment banks price default risks into the market with the lower valuations in the purchase prices. Banks and investors have both increased their leverage in the markets substantially in the past 12 odd years thinking … Read more Pointless Bailout Anyway