By: Dan Weil
The conventional wisdom is that individual investors are being taken for a ride by a bubble in the bond market, switching to fixed income from equities at just the wrong time.
Not so fast, says Wall Street Journal columnist Jason Zweig.“If anybody is to blame for a bond bubble, it isn't Joe Schmo; it's Uncle Sam, with some help from overseas,” he writes.
The Federal Reserve holds $2.04 trillion in government bonds, buying triple the amount that retail investors added to their bond holdings since the end of 2008.
As for foreigners, they have purchased $373 billion of Treasuries so far this year, more than 1.5 times what individual investors have put in all bond funds. (more)
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