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Zach B
Patrick Boyle
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Comments by "Zach B" (@zachb1706) on "The Big Bond Selloff" video.
@doctoronishispsychosislab1474 yes it is real. It's like a credit card, when you overdraft you are essentially borrowing from the bank.
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@jon9103 bonds were losing money anyway through inflation. Lets say at 3% inflation binds sit at 0.5%. If inflation falls to 2%, all else held the same, investors would be willing to take on a -0.5% bond.
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Why take those bonds on in the first place? - As the other guy put it, if bonds fell further your bond would become more desirable and would trade at a premium. - It may also be cheaper and safer than putting it in a bank. If interest rates continue to fall, deposit costs could fall further - Certain funds may use it to hedge risk or be forced to buy bonds to satisfy regulations - Foreign investors can use certain financial derivatives to actually turn a negative yielding bond into a positive one
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Why would I ever lend you my money if I don't profit?
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With what?
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You're not very bright are you
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