Add Robert Arnott to the list of well-known previously bearish investment managers who are seeing value in the market. “I like investments, if I’m getting paid to bear risk,” Arnott tells Brian Milner of Canada’s Globe and Mail. “And right now, this is one permabear who is strongly bullish on a wide array of markets.” Among those areas are a number of bond markets, including investment-grade and high-yield corporates; emerging-market debt, and inflation-protected government bonds.

Arnott also says that, apart from the most beaten-up sectors, the equity market is “broadly priced to reflect an expectation of recession. The bond market is priced for a Great Depression.” He likes deep value stocks, but says bonds are more attractive, and that could hurt stocks. “The ability of equities to recover handily is compromised, because there are better opportunities out there,” he says.

For example, investment-grade corporate bonds are now yielding about six percentage points more than comparable U.S. Treasuries, and five points more than the stocks of those same companies, Milner writes. That, he says, means stocks can only beat bonds if they show earnings and dividend growth better than 5 percent.

High-yield bonds, meanwhile, trade 20 points above Treasuries and 18 points above the stocks of the same companies, while emerging-market debt is yielding 10 percentage points above U.S. Treasuries, Milner writes.