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No. of Recommendations: 1
* They have a mandate to buy them, e.g. Argentine banks
* They have a mandate to buy them, e.g., they're in some bond index
* A trader thinks the price will rise in time for his (usually not her) year end bonus
* Some fund manager stuffs portfolios with them, since they meet some sort of dumb checklist on meaningless metrics like convexity
* There is a hunt for yield, and some dumber managers think that the extra return is free money rather than a clue about additional risk.
* Managers with perverse incentives making decisions on behalf of the actual investors, like those on commission. See the scene in Big Short at the banquet in Las Vegas.

* New suckers are born every day.


As an aside, what is the interest rate on a fixed-rate 30 year mortgage in the US right now?
Would you lend your money for that time frame with no inflation protection?

At the moment we are quite clearly experiencing deflation.

Elan
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