A number of commentators (including Warren Buffett) have warned that one bubble that is yet to burst is the US Treasury bond market. Very low yields result in high bond prices. Current yields are very low, driven down by the high demand for 'safety'. But when (if) bond yields rise, the price of those bonds will fall. And those commentators worry that the vast new issue of US Treasury Bills, Notes, and Bonds to fund the US stimulus program will generate an inevitable rise in yields -- investors will demand a higher return to be enticed into investing in a bond which is being issued in huge new volumes -- and the price of those bonds will 'collapse', generating capital losses for most bond holders. However, to date, there is little evidence that investors are demanding higher returns. Safety still trumps return. And so far, no US Treasury bond auction has failed to attract sufficient bidders.
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