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Is Pimco Right That Negative Yields Make Sense?
It’s longer retirements, stupid. That, in a nutshell, is why negative bond yields might not be a nonsensical bubble ready to burst but actually natural, according to Joachim Fels, Pacific Investment Management Co.’s global economic adviser. More people in developed economies are living longer and need to save for decades of retirement, which, according to Fels, is causing a radical shift in how people prioritize immediate spending compared with future consumption. In a blog post this week on Pimco’s website, he laid out perhaps the most concise and straightforward case I’ve seen yet for what structural ... (full story)