, Columnist
Fed Will All But Guarantee Negative Real Yields
All of the central bank’s potential next moves point to years of depressed government bond rates.
Living with negativity.
Photographer: Andrew Harrer/Bloomberg
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Federal Reserve Chair Jerome Powell has likely heard it all about negative U.S. real yields: How they’re devastating for pensions and life insurers, causing equity valuations to outpace the economic recovery, encouraging a stampede into gold and out of the dollar and giving the green light for American companies to gorge on cheap debt once again.
The message he and his colleagues are likely to convey at their meeting this week: That’s all fine with us.