Politics is the art of blaming everything bad on your opponent.
I was wondering if you have any explanation for long term bond yields being so low. Greenspan seems to be stumped.
LT interest rates are low because are real negotiable debt is only a little over 4 Trillion. This is a much smaller % of our GDP than the average Euro country. So Japan, UK and carribian banks all have a ton invested in treasuries and we just dont make many of them.
I was wondering if you have any explanation for long term bond yields being so low. Greenspan seems to be stumped.
No, I have no explanation. I have read some theories on the matter such as in the comments by Bill Gross at http://money.cnn.com/2005/05/18/markets/bondcenter/gross_outlook/. I do think that in order to come up with an explanation, it would help to have a better understanding of those who buy long term bonds. I don't own any long bonds, having heard for years about the risks of holding them, especially when interest rates are expected to rise. Nor do I know anyone who owns them. Hence, the precise motivations of long bond traders are a bit of a mystery to me.