Long-term govt bonds a 'bad bet'

NEW YORK - Long-term government bonds are a bad bet anywhere because nations are issuing debt to bolster their currencies, said James Chanos, hedge fund manager and founder of Kynikos Associates Ltd.

"Whether it's China, or the European Union or even the United States - if there's anything the central bankers and authorities have shown you is that we're worried about currency issues down the road so we're going to continue to issue debt to avoid any payment deflation," Chanos said at the Bloomberg Markets Hedge Fund Summit. "Long-term government bonds anywhere would probably be a bad bet right now."

Treasuries climbed on Tuesday, pushing 30-year bond yields to the lowest level in more than four months, as concern that a rescue plan for Greece hasn't contained Europe's debt crisis boosted demand for the safest assets. The US equities tumbled the most since February and European stocks erased their 2010 gain, while the euro slid to a one-year low. Chanos also said speculation in Chinese real estate has propped up the market.