Sometimes one comes across a written piece that so succinctly expresses a held point of view that the only job in hand is to circulate it.
The captioned piece (below) by Ben Inker of GMO’s asset allocation group delves into the phenomenon of price insensitive buyers of bonds and the havoc they may reek just if they cease to buy.
He describes the consequent overvaluation of long term bonds, focusing on the UK inflation linked series where pension legislation crowds providers into “insane” investments.
His probability based explanation of why equities will prove (with a 99% probability) a better investment than the 2062 Index Linked bond should be decisive to any rational investor.
Inker (GMO)_Price Insensitive Sellers