Curve Watcher's Anonymous has been watching the race to zero or negative yields in government bonds.
In the race to see which country will be first to hit zero percent or below on 10-year government bonds, Japan is currently in the lead at 0.295%, Germany is in second place at 0.447%, and the US trails mightily at 1.963%
Japan 10-Year Bond Yield
Germany 10-Year Bond Yield
Japan is in the lead, but the smart bet is on Germany. The reason is German rates are negative everywhere from 1-month to 5-years.
Germany 5-Year Bond Yield
Blue Ribbon Winner Announced
Germany wins the coveted gold medal in the prestigious 5-year yield category in a stunning come-from-behind victory after trailing by as much as 130 basis points (1.3 percentage points) as recently as 2010.
Yield on the Spanish 10-year bond is 1.64% compared to 1.963% on the 10-year treasury note.
ECB president Mario Draghi believes QE pushing rates even lower will cure Europe.
With yields this low, how can QE possibly do anything other than create even greater risk in sovereign bond speculation?
