Perfect storm sets up catastrophe bonds for record returns this year as investors price in climate costs

• Catastrophe bonds, or cat bonds, have enjoyed a perfect storm of conditions that are leading to a banner year. 
• According to the Swiss Re Cat Bond Price Return Index, year-to-date returns are clocking in at 16.5%.
• "It appears that if things go the way we think they might go, you might very well be looking at a record return of cat bonds this year."

It's been a tough few months for the bond market as persistent inflation, a ballooning federal deficit, and a debt downgrade have slammed Treasurys.