John Bogle, the founder of mutual fund company Vanguard Group Inc. who popularized index investing, said it’s impossible to have a bond market bubble because investors can expect to receive their money back when the bond matures.
Buyers of Treasuries at the current low interest rates merely agree to a smaller return for the duration of the bond, Bogle said today at the John C. Bogle Legacy Forum hosted by Bloomberg Link. Bogle said his comments didn’t refer to Europe, where some sovereign issuers are probably unable to meet their interest payments.
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