Mankiw: Wild Inflation May Make Bonds Look Irrational

Economist and Bush administration economic adviser Gregory Mankiw says hyperinflation could make today's bond market look like an irrational bubble.

"Is galloping inflation around the corner?” Mankiw writes in The New York Times.

“Without doubt, the United States is exhibiting some of the classic precursors to out-of-control inflation."

Investors snapping up 30-year Treasury bonds paying less than 5 percent are betting that the Federal Reserve will keep these inflation risks in check, notes Mankiw. (more)