Key insights
- Podcast suggests governments may inflate away debt as yields rise above affordable levels. This could lead to real losses for long-term government bond holders. Investors are considering shifting capital to equities, commodities, and hard assets to protect against structural inflation. Higher yields and potential inflation could pressure equity valuations.
If you're holding long-term government bonds as a safety net, this Podcast episode offers a massive warning sign.
The hosts point out that with US 30-year yields past 5% and UK yields flirting with 6%, the massive wall of maturing sovereign debt is rolling over at rates governments simply can't afford without inflating it away.
For those shifting away from fixed income to protect against structural inflation, where are you parking capital? Equities, commodities, or hard assets?
https://www.equitileconversations.com/2459100/episodes/19197344-inflation-the-next-wave