The Open Trap Door Under Real Yields Rings Many Alarms

from Zero Hedge

By Laura Cooper, market strategist at Bloomberg

With no imminent end to collapsing real yields – which just hit a new record low -1.10%, the side effects of financial repression warn of stagflation, asset bubbles and policy impotence. Fresh lows for U.S. 10-year real yields this week show a trap door opened by growing economic angst, climbing inflation expectations and an indefinite pause in monetary policy.

[…] The Fed’s explicit guidance that rates will stay near zero for the foreseeable future has markets pricing a hold until at least 2023, effectively killing price discovery.

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