The flood of bonds sold by governments around the world could prove troublesome for corporate issuers needing to refinance debt.
But won't the continuing flood of government bonds depress bond prices and continue to boost yields?
And another flood of government bonds is likely if Congress passes an $825 billion economic stimulus measure.
On Wednesday, even as it announced its huge financing needs for the latest quarter, the Treasury said financial markets could accommodate the flood of new bonds.
Bond investors are bracing for a flood of gigantic telephone bond offerings, but the uncertainties were high enough that British Telecommunications postponed an offering last week until its rating was clarified.
That made many analysts feel more comfortable about the flood of new junk bonds.
One has been a flood of new corporate bonds sold recently as companies sought to take advantage of lower interest rates.
IN CASE YOU HAVENT noticed, states and cities have recently unleashed a flood of tax-exempt bonds on the market as they try to take advantage of the decline in interest rates.
If the flood of money into the bond market reverses course or there is a drop in prices, the thinness of the market may become apparent.
Whether the flood into bond funds of all types was an intended consequence or not, it's now a flood that could go just as quickly the other way.
