Germany will pay you 0.072% per year to buy its debt
The good news for German bund owners is that at least you're getting a positive yield. Anyone buying debt out to 9 years now has a negative yield.
If this chart wasn't already at zero, it would look like it was about to break down. A close below 0.0746% will be an all-time low. The intraday low on April 17, 2015 was 0.0493%.
The last time German bund yields were down here, Bill Gross said it was the short of a lifetime. He was worried about the timing of the trade though and later said the time to do it wasn't until the ECB stopped buying in Sept 2016. That deadline has been extended, indefinitely.
"It's just a question of when," Gross said during an interview on CNBC's "Power Lunch." "It's certainly a trade that doesn't cost you anything in the short term, because it doesn't yield anything and it has the ultimate potential of a 10 or 15 percent (return) over a one- or two-year period of time."
A better bund trade might have been Goldman Sachs on July 17, 2015 when they said to buy bunds at 0.7910%. Unfortunately, they also shot themselves in the foot saying to buy bunds and sell Treasuries. Treasury yields are down 66 bps since then.
