Although flows into equity funds have picked up recently, flows into bond funds are currently five times higher than flows into stock funds. (The link to the graphic is here.)
Many investors have apparently given up on the stock market and now they are all about income. This is an interesting proposition with $11.7 trillion in U.S. debt outstanding and no clear way to pay it back. The bonds with the most income, high-yield corporates, are expected to have rapidly rising default rates.
Maybe nothing bad will happen to all of the income seekers, although I would point out that more money has been lost reaching for yield than at the point of a gun. At the very least, it might be a positive sign for the equity markets in a contrary opinion sort of way.
