Germany sold 30-year bonds at a negative yield for the first time, in another sign of how investors’ desperation for safe assets is inflating their value.
The bond, set to mature in August 2050, has a zero coupon, which means it pays no interest at all. Yet investors were still willing to pay more than face value to buy €869 million worth of the debt, pushing the overall yield on the bond into negative territory, at minus 0.11%. Yields fall as bond prices rise.
It's just a tool for liquidity that's all.
I am lost, who would invest money in a 30 year bond at 0% interest
Enjoy political 'bankruptcy' of economic theories of growth! ;))
Unfortunately, it doesn’t appear I’m smart enough to understand the logic of the investor purchasing this paper at these prices.
Isn't this called taxes?
Only rationale to buy is to find a greater fool later betting that rates will go more negative. Any pension fund manager buying these should be fired. The opposite of long term investing or liabilites management.
brianbeutler Offering them for sale is not quite the same as selling them
Who would buy that.
German Economic/Political Risk has a 2% premium vs. the US (2.04% with a flat curve)?
I'm going to buy German bonds!
For a loan of 30 years 😨😨😨 Germany will actually pay less than what its borrowed never mind that its not paying any interest
Immigration's bill
So remember before how you could give us $100 and we'd give you back $90 in a decade? This is the same deal except now you get to wait 3 decades for that same $90 back. Keep in mind you're only guaranteed to lose the same $10. You've heard enough?! I thought so. Sign here please
Why would you buy a bond that doesn’t pay any interest?
So, if they have to pay Germany to keep the bonds, if they don't pay the negative interest rate, are they forced to sell the bond back to Germany?
I've seen this movie before. It had an unpleasant ending.
Trump wants to go right down with them. Absolutely nuts.
Either the quality of assets has dropped or the interests of investors are too focused.
crampell Weak bid-to-cover ratio and sold less than half of the €2B planned for sale.
She needs it to support all that illegal immigration.
There's too much money, global capital markets and QE leads to this, so with so much money competing for limited assets/investments expect capital gains in some assets and low yields in others.
Crazy.
It means that a buyer pays the German Gov.
Germany is in trouble.
Jerk who buys
That's just crazy talk!
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