Bank Of America: Bond Yields Make Sense If We Are On The Verge Of "Something Really Awful"

We wonder if we’re looking at a future inductee to the “bond yields can’t get any lower!!”-Hall of Fame.


“It’s very hard to justify where yields are now, unless we are indeed on the verge of something really awful,” said Johan Jooste, a strategist at Bank of America Corp.’s Merrill Lynch Global Wealth Management unit in London where he helps invest about $1.4 trillion. “We are aware that there is a short-term factor, such as possibility that the Fed might buy bonds. But longer term, you have to ask yourself what you get paid if you hold government bonds.”

Here’s the latest look at the US curve. At least for today, with stocks sliding, you’re doing well owning Treasuries.


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