Thursday, February 9, 2012

Bonds - the most dangerous of assets, says Buffett

Buffett: Bonds Among Most Dangerous Assets

Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc., said low interest rates and inflation should dissuade investors from buying bonds and other holdings tied to currencies.
“They are among the most dangerous of assets,” Buffett said in an adaptation of his annual letter to shareholders that appeared today on Fortune magazine’s website. “Over the past century these instruments have destroyed the purchasing power of investors in many countries, even as these holders continued to receive timely payments of interest and principal.”
Comment: This time at least words of wisdom come out of Omaha that investors better should heed. Bonds are assets whose other side is debt and we're past the peak of the age of debt, government debt in particular.

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