Guest JoelS Posted January 17, 2017 Share Posted January 17, 2017 Buffett has been saying for years now that bonds are a quote "terrible investment". With inflation picking up and governments, including the USA, promising large infrastructure spending, are we closer to the end of this bond bull? Rates have gone up considerably over the past few months, but looked at within the broader context of history, perhaps the second and third leg is yet to come. A few areas of discussion might be: Thoughts on bond valuations Could a bond collapse tip over into equities Distressed debt How would you structure a short bond trade. All contributions appreciated. Inflation: http://www.economist.com/news/finance-and-economics/21714375-deflationary-fears-are-last-point-being-banished- Distressed debt market: https://blogs.cfainstitute.org/investor/2014/10/30/who-will-suffer-from-a-leveraged-credit-shakeout/ http://www.grantspub.com/files/presentations/Fridson%20Spring%202014.pdf Buffett: http://www.reuters.com/article/us-berkshire-buffett-idUSBRE9450AO20130506 "Bonds, they're terrible investments now," Buffett said. "That will change at some point, and when it changes, people could lose a lot of money if they're in long-term bonds." https://www.bloomberg.com/news/articles/2016-04-30/buffett-says-bonds-unattractive-if-not-terrible-for-reinsurers https://www.youtube.com/watch?v=kFB8Tx_48po (from 6:15) Lee Cooperman has said “Buying bonds is like bending down to pick up a quarter in front of a steam roller. what are your thoughts on that?” Buffett: “I’m not even sure it’s a quarter.” Link to comment Share on other sites More sharing options...
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