192.61% Yield on Greek 1 Year Bonds

It’s rare that you’ll see a chart like this for government debt, so thought I would post a screen cap:

Preet Banerjee
Preet Banerjee
...is an independent consultant to the financial services industry and a personal finance commentator. You can learn more about Preet at his personal website and you can click here to follow him on Twitter.
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Showing 8 comments
  • Henry

    The market thinks that Greek bondholders will take more than a 50% haircut.

    • Preet

      Agreed – the trend in this whole saga is that any time a number is mentioned, you almost know it’s going to end up being bigger.

  • Steve

    Ok – so walk me through the math here – if I buy a $100 bond November 1st, it’s supposed to pay me $192 over the year and then return my capital next November. Right? Even if yield is cut in half ($96) and the value of the bond itself is cut in half ($50) – I’d still have $146 next November – which is a 50% gain.

    What’s so bad about that?

    Feel free to explain this to me like I’m a six-year-old.

  • Steve

    Thanks for the explanation Preet!

  • harjinder gandhi

    what is the name of your business and how can i contact you to get some help in financial planning. i am thinking of retiring next year, 68 years old.

    regards

    • Preet

      Hi Harjinder, I do not advise clients any more (gave up my license in 2008). Where do you live? I might know a good planner in your area…

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