- Former Fed Chief Alan Greenspan said “abnormally low” interest rates will break a bubble in the bond markets.
- Greenspan is famous for warning markets about “irrational exuberance” and the consequences it can bring.
Former Federal Reserve Chairman Alan Greenspan issued a bold warning Friday that the bond market is on the cusp of a collapse that also will threaten stock prices.
In a CNBC interview, the long-time central bank chief said the prolonged period of low interest rates is about to end and, with it, a bull market in fixed income that has lasted more than three decades.
“The current level of interest rates is abnormally low and there’s only one direction in which they can go, and when they start they will be rather rapid,” Greenspan said on “Squawk Box.”
That low interest rate environment has been the…
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