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John Authers

Greenspan's Conundrum Has Returned to Haunt Markets

The combination of declining 10-year bond yields and rising inflation points to a future of financial repression and the inescapability of buying stocks.

This bears watching closely.

This bears watching closely.

Photographer: Alex Wong/Getty Images

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Back in 2005, the then-chairman of the Federal Reserve, Alan Greenspan, complained of a conundrum. He had hiked the Fed’s target rate six times, by a total of 150 basis points, and yet he had barely budged the 10-year Treasury yield. It remained steady, and continued its gently declining trend.