Blain’s Morning Porridge – Bond market signals

MorningPorridge/Bill Blain

Image of Humpty Dumpty clinging to wall as he falls, antiqueThe problem is… the global bond market is now in excess of $115 trillion (a very very big number) and its grown dramatically since the 2008 crisis. It’s just about tripled according to one set of numbers I looked at. When the bond market crunch comes, let’s assume there will be some very very large losses – and all the systemic bad consequences that will go with that.  Worry less about how index funds, or ETFs will trigger the next crisis, but what happens when bond markets collapse on a few points of interest rate rises, triggering massive defaults, while chronic illiquidity creates the biggest value trap of all time. Ouch. “

USAGOLD note:  Sounds like something that should be strategically hedged for the long term. . . . And that is what a good many professional investors are doing.

Repost from 9-5-2019

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