Bill Gross: Negative rate bonds are a supernova waiting to explode

Bill Gross, former PIMCO boss, and manager of the $1.4 billion Janus Global Unconstrained Bond Fund, warned central bank policies that pushed trillions of dollars into bonds with negative interest rates will eventually backfire violently. “Global yields lowest in 500 years of recorded history,” he wrote Thursday from the Janus Capital Group Twitter profile. “$10 trillion of neg. rate bonds. This is a supernova that will explode one day.” In an interview with Bloomberg, he said that “[the bubble] is big. With negative interest rates in 40% or 50% of the developed market world, there’s no doubt that there’s a bubble with -25 basis points on a German 5-year [government bond]. That this is a market bubble is almost undeniable.” Read more: (VIEW LINK)