How Scary Is the Bond Market?

In the bond market, since June, due to the influence of multiple factors such as fundamentals and investor sentiment, the bond market has taken on a trend of improvement.

Convertible

Convertible Marks

Non convertible

Convertible US

Convertible currencies

Cuban Convertible Peso

Bosnian Convertible Mark

Convertible non US

Non convertible currency

A red Simca convertible.

Bosnia and Herzegovina Convertible Mark

Light gray Dodge convertible wanted.

He won a Cadillac convertible.

1961 Moskvich hardtop convertible... twotoned.

Walter. A 1931 Walter. Convertible.

Mr. Bond! Mr. Bond! Mr. Bond!

Bond. James Bond.

Bond. James Bond.

Bond? James Bond?

1946 Plymouth convertible, California license 40R116.

Some kind of a white convertible.

11 The Asian Bond Market Initiative was endorsed at the ASEAN 3 Deputies Meeting held in Chiang Mai in December 2002. Its objective is to develop efficient bond markets in Asia.

The solution suggested by the Governor was to borrow about 400 million on the bond market to offset the deficit.

We see ever growing support for the proposal to develop an Asian bond market, which I put forth in 2001.

Meanwhile, the main transmission channels of monetary stimulus to the real economy the bond, credit, currency, and stock markets remain weak, if not broken. Indeed, the bond market channel is unlikely to boost growth.

My name is Bond, Jamal Bond.

James Bond. Oh, yes, Mr Bond.

Non convertible currencies held at 31 December 2004

How do you like this? A horsedrawn convertible.

She sure took off with that convertible fella.

In short, though central banks creation of macro liquidity may keep bond yields low and reduce volatility, it has also led to crowded trades (herding on market trends, exacerbated by HFTs) and more investment in illiquid bond funds, while tighter regulation means that market makers are missing in action.

The Asian bond market and Asian bonds are thus mechanisms for financing for development that also promote greater regional economic stability.

Any United Nations bond issue would be evaluated by market participants and potential investors by its credit rating, which is a formal evaluation of the creditworthiness of the bond issue by an independent credit rating agency.

f Includes 6,013.79 equivalent to non convertible Rwanda francs.

It is true that extraordinarily low long term bond yields put us outside the range of historical experience. But so would a scenario in which a sudden bond market crash drags down prices of stocks and housing.

For example, the Republic of Korea has undertaken measures to encourage the issuance of bonds by SMEs.10 One objective of the Asian bond market initiative11 is to increase bond financing options for smaller companies in Asia.

Bond

Bond

Bond.

MAN ON MEGAPHONE Ahoy, Mr. Bond. Ahoy, Mr. Bond.

Surprisingly, the bond market still seems almost oblivious to this risk. But holders of US debt worldwide have every reason to be concerned.

Table 5 Non convertible currencies held at 31 December 2004

c Includes a 590,131 equivalent of non convertible Syrian pounds.