Bond guru Bill Gross believes the growing global move toward negative yields will have dire consequences.
In a tweet from his firm, Janus Capital, Gross goes back half a millennium to assert that the current situation with the world's debt market is unprecedented and dangerous
Janus Capital @JanusCapital
Gross: Global yields lowest in 500 years of recorded history. $10 trillion of neg. rate bonds. This is a supernova that will explode one day
The warning comes as yields on Japanese government bonds and German bunds hit record lows.
In fairness I think it's worth remembering that 500 years ago (and even 200 years ago) lending money was a bit more risky than it is in the modern and developed world.
I'll always remember Bill Gross because the year I jumped into the PP and reluctantly bought my first LTT's he declared that the time had come for investors to dump U.S. bonds. So, I thought OMG what have I done? Most of you know the history but it was a banner year for LTT's. I think they were up around 33%.
