Epic bubble in the bond market ready to explode

"We're in an epic bubble of colossal proportions", so Peter Boockvar, managing director and chief analyst at the Lindsey Group, referring to CNBC what is happening on the global bond markets.

In fact, the market for government bonds perceived as "safe", are touching ever lower yields: that of the ten-year US Treasury bond this week fell to historic lows. According Boockvar, investors are not rushing to buy stocks from very few returns for the interest they offer, but to achieve capital gains (or capital gains).

"It 's something that we had never seen before," says Boockvar. The analyst of the Lindsey Group believes that to promote the attractiveness of Treasuries were negative yields on German bonds, Swiss and Japanese, joined to inappropriate monetary policies. The latter, he says, have hit in particular that Italy has to deal on the one hand with negative rates that reduce the profitability of banks and, secondly, with the need to raise capital to plug the holes left by credits deteriorated. "Maybe that Italian banks are telling us that the lead institutions and their negative rate policies are indeed destroying the European and Japanese banking systems?", the question for the analyst.

Even if Mario Draghi and Haruhiko Kuroda, the governors of the European central banks and the Japanese, did back down on negative deposit rates, however, Boockvar provides major repercussions on the bond market: "Although deposit rates were reduced to zero, you can imagine a slaughter, at least in the short term, on the bond market. "