Orbis's Lynn: The contrarian bond view earning a 16% yield

Most investors shunning energy companies due to oil price volatility

I remember receiving a chain letter in my youth: "Send one dollar to the person at the top of the list," it said, 'and then add your name at the bottom. Forward the letter on to five friends, and pretty soon you'll be rich!"

It is a scheme that cannot end well: paying for something worthless in the hope that people down the line will pay even more than you did. Yet that looks like the thesis with many long-dated government bonds today. If you had invested in the JPM Global Government Bond index since 1990, you would have made 5.5% p.a. But you did not make most of that money by collecting coupons. You made it because other investors came along willing to pay more, driving prices up.  But as prices rise, yields fall. Today, 10-year yields in many developed markets are so low that when you factor in expecte...