Beginning in 2011/12 government bonds and their yields were subject to a mysterious ledgerdemain, which can be regarded as a variant of a stage magician’s trick: levtitating a woman. But in this case the magician did not lift an individual. The levitation affected the time value of the government bonds of “southern” countries in crisis, while their interest rates followed an imperceptibly sinking trajectory. Within only two years the yields have gone down roughly 60 per cent from where they used to be at the height of the crisis. [Read more...]
