Tiger’s Robertson Says Bond Bubble to End in ‘Very Bad Way’

[Purveyor]

By Devin Banerjee Sep 22, 2014 12:37 PM ET

Julian Robertson, the billionaire founder of Tiger Management LLC, said there’s a bubble in bonds that will end “in a very bad way.”

“Bonds are at ridiculous levels,” Robertson said today at the Bloomberg Markets Most Influential Summit in New York. “It’s a worldwide phenomenon that governments are buying bonds to keep their countries moving along economically.”

Robertson was joined by other billionaire money managers at the summit in expressing concern that debt markets are overheated. Omega Advisors Inc. founder Leon Cooperman called bonds “very overvalued.” Howard Marks, the chairman of Oaktree Capital Group LLC, said on a later panel that investors are taking on more risk in their portfolios as central banks worldwide keep interest rates low and suppress yields on traditional fixed-income investments.

“If you participate in that enthusiasm then you’ll also participate in the correction,” Marks said in a Bloomberg Television interview from the summit. “As the environment becomes more enthusiastic we have to become more cautionary and try to clip the top of that cycle rather than participate in it.”

‘Unnaturally Low’

Oaktree (OAK), which Marks co-founded in 1995, is preparing for the correction as high-yield, high-risk debt is headed for its sixth positive year. The Los Angeles-based firm is seeking $10 billion for a fund with plans to sit on most of the capital until more companies enter distress, people familiar with the plans told Bloomberg News this month.

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http://www.bloomberg.com/news/2014-09-22/tiger-s-robertson-says-bond-bubble-will-end-in-very-bad-way-.html

[Sopkoviak]

1. But the FED won't stop the QE

Until after the mid-terms.

So there's that.