Beware of the bubble in bonds

Beware of the bubble in bonds

11:46 25/05/2010, CNNM Stock Market from Wall Stree

Here we go again. In just six weeks the prices of U.S. Treasuries have soared, sending the yields on the 10-year bond from 4% back to 3.2%, close to their levels when terror reigned early last year. Don't let Wall Street's cheerleaders convince you that the sudden drop in the cost of borrowing heralds a new era of moderate inflation that will keep Treasury prices aloft, and interest rates low, for years to come.