Where the risks and opportunities are

LEADING equity markets are touching all-time highs and bond yields record lows while warnings are being sounded that investors are "flying too close to the sun" - which could melt their wings and send them crashing to earth. BT asked its panel of international financial experts to advise on where the risks (and opportunities) lie for investors.

The Business Times: Just how bad is the situation, and which markets are most at risk - equities or bonds, advanced or emerging? Kenneth, you set the ball rolling.

Kenneth Courtis: As oceans of liquidity continue to flood over the weak economies in Japan, Europe and North America, which are quite incapable of absorbing much of these funds, there is a resulting torrent of cash which squats in what would in normal times be considered to be highly over-valued assets. German bond yields which are today negative out to seven years! In parts of Europe, blue chip companies …