[sammyg2]

Originally Posted by MRM

Rational discussion is unlikely to change any minds, but I feel compelled to give it a try anyway.

The article is talking about the returns bondholders are seeing these days when the company goes bankrupt, not the returns on investment grade bonds. It's not exactly shocking that the bond holders lose their investment when the company goes bankrupt. The company wouldn't go bankrupt if it could pay its bondholders. The point of the article is nothing more that when there is cheap credit and investors are chasing yield, some of those willing to take risks on junk bonds end up with little to nothing on their investment.

You have to read Zero Hedge with a critical eye. It is a Russian propaganda organ that publishes just enough real news to stay credible to the credulous while pursuing its real mission of spreading doom and gloom conspiracy theories to weaken the social fabric of America and further the Motherland's interests. The more people read articles like this and post threads the the OP, the less credible America's institutions appear and the better off America's foreign adversaries are. Next time you read an article about an upcoming oil shock or crash in the auto industry, remember that Russia is one of the world's largest oil exporters. When you read articles about how unstable the US Dollar or how close we are to economic collapse, remember how low Russia's foreign currencies are (and that oil is priced in Dollars).

There are plenty of reasons to question the government's free spending policies and fear the adverse consequences of artificially low interest rates, but none of those reasons are found in Zero Hedge's articles and the "solutions" offered are conveniently counterproductive to the US economy and would benefit its adversaries. And as a double whammy, wacky conspiracy theories about the Fed destroy the credibility of serious thinkers who legitimately question Fed policy. The crazier Zero Hedge can convince fiscal conservatives to act, the more they discredit the entire conservative monetary movement.

By the way, if the Fed was so powerful, how come it hasn't been able to manufacture even its stated goal of 2.5% inflation?

Hey, I was gonna say that (but no where near as ela-kwont-ly)