If / As / When interest rates / monetary policy start to normalize, it will be like someone shouting "Fire" in a packed theatre, with only one small door. For what it is worth, I have started to pull back from corporate bonds in recent weeks. Indeed, we have one of the arguably 100% guaranteed red warning lights flashing in this sector. The well known bond management house, Pimco, has a closed ended bond fund which, would you believe it, stands at a 70% premium to its underlying asset value. When investment trust-like vehicles stand at large premia to asset value this is usually 'kiss of death' warning stuff. I reported on one such China investment trust in a Bulletin (50% premium), just before the Chinese stock market crashed. To be fair, an equity market, when highly inflated, is likely to have a larger potential downside than corporate bonds of reasonable quality. And you can hold the bonds to maturity- albeit at huge potential opportunity cost and accept the likely existing loss to redemption. Fitch Ratings suggest that a return to early 2011 levels in Treasuries would take about 15% off the price of the average US corporate bond.

David Fuller's view I always find plenty to agree with and some points to disagree with in Peter Bennett's reports, and in that respect they help me to think.