So far, so good, for equity investors at least. Government bonds yields may be soaring around the globe but they have yet to derail the stock market rally which started in March. But how much longer can this continue? At what point will it become a problem? Government bonds have suffered a terrible 2009. Ten-year US Treasury and UK gilt yields are both close to 4 per cent, having started the year at 2.22 per cent and 3.01 per cent respectively, even though their central banks have engaged in quantitative easing programmes.

They are the worst performing asset class this year and the sell-off in US Treasuries has been as big as that in 1994.