Jim Grant: “Uncomfortable Shocks” Lie Ahead As The Great Bond Bear Market Begins

“Jim Grant, editor and founder of Grant’s Interest Rate Observer, is one of a handful of credit-market luminaries who have declared the end of the 30-plus-year bond bull market that began in 1981. Interest rates, Grant argues, probably touched their cycle lows during the summer of 2016. And as the secular bear market begins, investors who have uncritically accepted obvious aberrations like Italian junk bonds trading with a zero-handle will face a painful reckoning.

“…and since interest rates are critical in the pricing of financial instruments, these distortions preceded the uplift in all asset values.. and the manifestation of this manipulation is in many ways responsible for what we are now seeing in the markets.’”