LGIM: is the bond fund bubble waiting to burst?

Macroeconomic risks have rarely been greater. Many economies are at stall speed if not outright recession, the US is facing the uncertainty of forthcoming elections and a looming fiscal cliff, while the euro crisis appears to be reaching a make-or-break moment. Despite this uncertainty money keeps coming into fixed income funds, reacting to the low interest rate environment by looking for yield. Is this the result of successful non-standard monetary policy, or another bubble waiting to burst? By cutting interest rates to virtually zero and then buying significant amounts of governme...