by Wolf Richter
Wolf Street
A normal cost of capital is a form of much-needed discipline for governments and investors, after years of free money turned their brains to mush.
The 10-year yield of UK government securities rose to 4.82% today, the highest since July 2008. The 30-year gilt yield rose at one point today to 5.47%, the highest since 1998, though it backed down to 5.38%. So the UK is a little ahead of US Treasury yields (4.69% and 4.93% respectively).
There was a lot of handwringing in the financial media today and recently about those surging yields, with terms like “gilt market rout” getting into the headlines, and some even seeing a “return of the bond vigilantes,” etc. etc. But wait a minute…