When it comes to overpriced government bonds, we thought we had seen it all. But last week’s $1bn Iraqi bond sale seemed “to define the very idea of a credit bubble”, says Marcus Ashworth on Bloomberg.com. The five-year paper Iraq sold, offering a yield of 6.75%, was seven times oversubscribed, reflecting the desperate hunt for yield among global bond investors. The launch follows Argentina’s sale of 100-year debt and Greece’s return to the debt market despite its ongoing bailout.
Iraq has agreed a $5.4bn bailout with the International Monetary Fund and the [...]