Bond yields could create another bubble says Carl Icahn

The risk of a domino effect, should the bond markets across the globe plummet has increased. This is following the high bond yields in markets, which have a lot of cash rich tech companies underwriting these corporate debts. The Office of Financial Research group, which was set up within the US Treasury department after the 2008 crisis to find out the  causes of financial crisis using forensic tools, has already named the corporate debts one of it's biggest concern. However, the Feds have maintained  rates following fears of an increase which seemed not too popular at the time. There were increasing fears this could aggravate the crisis in other parts of the world and push the global economy into another recession.  A lot of investors who are profiting, even billionaire investor Carl Icahn, are concerned according to Time business.


 Icahn says low rates caused bubbles in art, real estate and high-yield bonds – with potentially dramatic consequences.
"It's like giving somebody medicine and this medicine is being given and given and given and we don't know what's going to happen - you don't know how bad it's going to be. We do know when we did it a few years ago it caused a catastrophe, it caused '08. Where do you draw the line?"
In a telephone interview, Icahn said he's "more hedged now than I've been in years."
"The Fed may have backed itself into a corner. They should have absolutely raised rates six months ago," adding it's difficult now because of global concerns.

He says that the long-term low-interest rate environment had “forced a bubble in which people are pushed into risky securities like high yield bonds in a search for yields.” The dependence on such rates is a disease,” says Icahn. 
The system of low interest was meant to help capital flows to the little guy, but instead has fueled an asset bubble which is helping Wall street. In recent times, people like Donald Trump, Carly Fiorina and Benie Sanders have done well because of the disillusionment with the political status quo, with Trump actually offering Icahn the position of Treasury secretary. A job Icahn says he does not want.