Didn't work as you describe in the early 90's when Bush enacted a Luxury Tax. Im sure the existing boat manufacturers remember. And all the luxury import car mfgs, well, AFTER experiencing significant sales drops, they contributed heavily to various PACs and politicians, and stepped up lobbyist actions. Additionally luxury auto mfgs were logically forced to offer rebates and incentives SPECIFICALLY to offset the luxury tax. Clinton ultimately repealed the tax.
So what? A little dent in sales those years, those who made great cars are they still alive today? They are. Proves my point, a great product survives those relatively small issues. Even those issues may seem a big deal when they happen. Keyword: "in the grand scheme of things"
We seem to talk sideways...let me try to get back to my point. Fed or ECB are not lowering rates with the core target to devalue their currencies. Even if they did, exchange rates do not have a major impact on otherwise strong and healthy companies in the long term.
I'm no expert on bonds but I'll give a comment. Normally, the yield curve is upward sloping due to the fact that inflation is being priced in. The forward coupon payments and face value are being discounted against inflation. More distant maturities are affected more strongly. So, if the short term paper is yielding higher than say the 10-year it means that portfolio managers are selling their short term bond holdings and moving further out on the curve. This is because they think the FED will cut rates soon (bullish for bonds) because a recession is coming (reduced inflation). Basically, reduced inflation boost long term paper more than short term.
I doubt that is the reason. US Treasuries are paying more than most countries. There are currently over $17 Trillion in negative rate bonds worldwide. The Fed is way behind in the race to the bottom. Higher rates on Treasuries mean bigger deficits for the gov't. Switzerland AAA 10yr rate: -0.983% Germany AAA 10yr rate: -0.702% The US 10yr yield @ 1.5% is even much higher than (PIIGS) BBB-rated Portugal. Portugal BBB 10yr rate: 0.142% http://www.worldgovernmentbonds.com/ P.S. I am not a fan of negative rates; it hurts savers, keeps zombie companies afloat, etc.