Markets

SocGen: Here’s How The Bond Market Will Respond To 4 Different FOMC Scenarios

[credit provider=”Wikimedia Commons” url=”http://en.wikipedia.org/wiki/File:FF232.jpg”] SocGen’s house view as explained by its economist Michala Marcussen is that the Federal Reserve will announce $600bn of new asset purchases today at the FOMC meeting, split 40 per cent to 60 per cent between mortgage-backed securities (MBS) and US Treasuries.SocGen’s rates strategy team assigns […]
SocGen: Here’s How The Bond Market Will Respond To 4 Different FOMC Scenarios
Markets

This Idea About The Treasury Locking In Low Rates Really Needs To Die

[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:Vorh%C3%A4ngeschloss_und_Rost.jpg”] We’ve hit on this meme a number of times, but it continues to go around, so we’ll do it againDoug Kass is the latest to argue that the Treasury needs to issue a lot more longer-dated debt to, as he puts it, “Lock in low rates […]
This Idea About The Treasury Locking In Low Rates Really Needs To Die
Markets

This Collapse In US Interest Rates Is History In The Making—Here’s What It Really Means

[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:Mountrushmore.jpg”] The current title on our CHART OF THE DAY today is simply 1.53760 per cent, which represents the current yield on a U.S. 10-year Treasury.For folks in the financial industry, that number is “mesmerizing,” but we also recognise that a huge swath of the population has […]
This Collapse In US Interest Rates Is History In The Making—Here’s What It Really Means
Markets

REVEALED: China Has A Direct Computer Link To Buy US Treasuries And Bypass Wall Street

[credit provider=”Flickr/Marjan Krebelj” url=”http://www.flickr.com/photos/nikio/3899114449/sizes/z/in/photostream/”] In general, it’s our stance that Chinese ownership of US Treasuries is overblown as an issue to be interested/concerned about.People make a big deal of undulations in the level of UST holdings by Beijing, and some people are mistakenly under the belief that they have us […]
REVEALED: China Has A Direct Computer Link To Buy US Treasuries And Bypass Wall Street
Markets

All Signs Are Go For The Last Great Ponzi Scheme

[credit provider=”Daniel Goodman / Business Insider”] The Treasury had a heavy calendar this week, but the new supply won’t settle until May 15. After Tuesday, Treasury supply will not pressure the market until the end of month settlement of notes and bonds. But the market has other problems and they […]
All Signs Are Go For The Last Great Ponzi Scheme
Markets

Bond King Dan Fuss: ‘Treasuries Are Priced Higher Than A Kite’

[credit provider=”Bloomberg TV” url=”http://www.bloomberg.com/tv/”] U.S. government bonds have seen their yields suppressed by Federal Reserve purchases. Veteran bond investor Dan Fuss of Loomis Sayles Bond Fund, who has previously said that he likes corporate bonds and stocks relative to treasuries, was on Bloomberg TV saying he thinks treasuries are priced way […]
Bond King Dan Fuss: ‘Treasuries Are Priced Higher Than A Kite’
Markets

SRI-KUMAR: ‘Go Big’ On Treasuries

Komal Sri-Kumar, Chief Global Strategist and Group Managing Director for TCW, appeared on CNBC yesterday with a sharp warning against the excitement being generated in the markets right now—and particularly against yesterday’s sudden sell-off in Treasuries.
SRI-KUMAR: ‘Go Big’ On Treasuries
Markets

Gary Shilling’s 6 favoured Asset Classes

[credit provider=”Bloomberg” url=”http://www.bloomberg.com/video/83013506/”] Gary Shilling’s latest Insights Newsletter contains an updated list of his asset allocation.  Shilling is a superb macro analyst.  I thought you might find his positioning and insights useful when considering the current environment: Treasury bonds (favourable) – Treasurys have rallied as a safe haven in a sea […]
Gary Shilling’s 6 favoured Asset Classes
Markets

Does Bond Market Carnage Lie Ahead?

JP Morgan recently released their macro view of the markets and the economy and it provides a useful overview of the current environment and how they’re positioned.  They are expecting continued asset reflation in risk assets, but are bearish on bonds and commodities:
Does Bond Market Carnage Lie Ahead?
Markets

When The Deflation Tsunami Hits, Losing The Least Is A Winner

[credit provider=”www.shorpy.com” url=”http://www.shorpy.com/node/12389″] This is a Guest Post by long time TAE regular, El Gallinazo.A subject that commonly comes up in TAE is what to do with your savings if you have too much to stuff in “that creative place” that Nicole often refers to. And what she suggests is […]
When The Deflation Tsunami Hits, Losing The Least Is A Winner
Markets

A Notable Omission From Bernanke’s Testimony To The House

Bernanke’s testimony to the House last week and to the Senate yesterday held no surprises. Ben has promised to maintain monetary policy at DEFCON 4 levels for as far into the future as we can see. The prepared remarks were identical for both presentations. I reviewed Bernanke’s 10/4/2011 testimony before […]
A Notable Omission From Bernanke’s Testimony To The House
Markets

TREASURY TO INVESTORS: We Might Allow You To Pay Us To Hold Your Money

[credit provider=”sidknee23 via Flickr” url=”http://www.flickr.com/photos/sidknee23/3626226624/in/photostream/”] A recent Reuters article had the headline, “Treasury May Let Investors Pay to Lend to US.” Wait a minute, what? Apparently the Treasury is “looking closely at allowing negative-yield auctions.” When I read this I literally couldn’t believe it. The really amazing thing is this […]
TREASURY TO INVESTORS: We Might Allow You To Pay Us To Hold Your Money
Markets

The Weaker US Finances Get, The More People Seem To Want To Lend It Money

[credit provider=”coljay72″ url=”http://www.flickr.com/photos/coljay72/2399545998/sizes/m/in/photostream/”] We went around the world last week. We wish we could say we learned something. But modern travel has been standardized…and culture and technology have been “globalized”…so that the more you travel the more you feel you never left home.”How was your trip around the world?” asked […]
The Weaker US Finances Get, The More People Seem To Want To Lend It Money
Markets

Marc Faber Lost A Bottle Of Whiskey On This Treasury Call, But He’s Sticking To It

[credit provider=”Bloomberg Television” url=”http://www.bloomberg.com/video/84596910/”] Marc Faber, the brains behind the Gloom, Boom and Doom report thinks Treasuries are in a bubble.This is actually a call he has been making since 2009.  And now he owes economist David Rosenberg a bottle of Cutty Sark because Treasuries ended up rallying, even after […]
Marc Faber Lost A Bottle Of Whiskey On This Treasury Call, But He’s Sticking To It
Markets

There May Be A Simple Explanation For The Weird Rally In Stocks

[credit provider=”Bloomberg” url=”http://www.washingtonpost.com/business/belski-says-oppenheimer-sees-sandp-at-1475-by-end-of-2012/2011/09/08/gIQAD9D7BK_video.html”] Lately, there’s been an interesting trend developing in the markets:  Treasury yields have been falling, while stock prices have moved sideways or up.In other words, the prices of risky assets have held up, while the prices of risk-free assets haven’t seen an offsetting sell-off.
There May Be A Simple Explanation For The Weird Rally In Stocks
Markets

Why Bill Gross Is A Treasury Bull These Days

[credit provider=”Bloomberg TV”] Bill Gross famously missed much of the Treasury rally in 2011, but lately he’s been re-cranking up his bets on US debt.In an interview with Bloomberg TV, the PIMCO manager explained why he’s a bull right now:
Why Bill Gross Is A Treasury Bull These Days
Markets

The Most Misunderstood Asset Class Today

Richard Bernstein,, the former Chief Investment Strategist of Merrill Lynch, is out with his 2012 outlook, which includes his five favourite investment themes.  One of those themes: “Positions in treasuries to maintain portfolio diversification.”
The Most Misunderstood Asset Class Today
Markets

Bill Gross Beefs Up His Bet On Treasuries

[credit provider=”Bloomberg TV” url=”http://www.bloomberg.com/video/80286516/”] Everyone remembers when Bill Gross started dumping Treasuries and eventually went short.  And no one wants to forget that more than Bill Gross (see his mea culpa).Anyways, Bill Gross has since gone long Treasuries in his PIMCO Total Return Fund.
Bill Gross Beefs Up His Bet On Treasuries
Markets

Gold Is Still A Safe Haven, But It’s Being Distorted By The Fed

This week, world attention finally shifted away from debt problems in Europe to the unresolved and worsening debt crisis here in the United States. The Congressional Super Committee, which had been created over the summer by the House and Senate to avoid responsibility for the debt crisis, chose to avoid […]
Gold Is Still A Safe Haven, But It’s Being Distorted By The Fed
Markets

Check Out All The Fed Has Done For The Market In The Past Three Years

At present we are in the early stages of the latest Federal Reserve intervention, Operation Twist, which was officially announced on September 21 after several days of rumours. We’ve now seen several bouts of aggressive Fed attempts to manage the economy following the collapse of the two Bear Stearns hedge […]
Check Out All The Fed Has Done For The Market In The Past Three Years
Markets

The Draw Down Of The Federal Reserve’s Custody Holdings Ends

The Federal Reserve reports its custody holdings for foreign central banks on a weekly average basis and on a Wednesday-to-Wednesday basis.  The data is reported every Thursday.  In this space I have been tracking a sustained decline in these holdings in recent weeks.   It now looks like the trend […]
The Draw Down Of The Federal Reserve’s Custody Holdings Ends
Markets

Some Long-Term Perspective On Treasury Yields

Note from dshort: The October rally in equities (the S&P 500 is up 8.23%) has been matched by the selloff in the 10-year note. The yield closed the week at 2.26, up 54 basis points from its all-time closing low of 1.72 on September 22.
Some Long-Term Perspective On Treasury Yields
Markets

Two-Year Bills Sell Out Faster Than Banks Can Grab

[credit provider=”AP Photo/Jason Redmond”] $35 billion in two-year treasuries sold to fervent demand today, sending yields down to 0.249% from a 0.251% forecast.Bidders tendered nearly $132 billion in offers for the purchase — a level not seen since September 2010 — outstripping availability by more than 375%. The resilient purchasing […]
Two-Year Bills Sell Out Faster Than Banks Can Grab
Markets

Say What You Want, But Investors Have Made Bank Betting On Bernanke

Investors betting U.S. government debt due in 10 years or more have done well.  In fact, they haven’t done done this well since 1995, Bloomberg reports. This despite concerns from lawmakers and economists alike that Bernanke’s easing policies would lead to the extreme devaluation of the dollar and uncontrollable inflation.
Say What You Want, But Investors Have Made Bank Betting On Bernanke
Markets

Was Operation Twist Priced In?

Most Fed watchers had anticipated the announcement of Operation Twist for months. Treasury traders were on board, causing long-term Treasury rates to fall.  As a result, many believed the twist was priced in.
Was Operation Twist Priced In?
Markets

The Yield Spread Is Lying About The Coming Recession

You are being lied to. There is currently more than sufficient evidence that indicates that we are either in, or about to be in, a recession.  The last time I made that statement was in December of 2007.   In December of 2008 the National Bureau of Economic Research stated that […]
The Yield Spread Is Lying About The Coming Recession
Markets

David Tepper Is Going Balls To The Wall In Cash

For those wondering why David Tepper will be strangely missing from CNBC for his annual pre-QE cheerleading appearance, we now have the answer. As Institutional Investor reports, the Appalloosa head man, who was long everything but mostly financials in the form of BofA and Citi last year, and managed to […]
David Tepper Is Going Balls To The Wall In Cash
Markets

Chinese Corporate Bonds Are Tanking Like It’s 2008

[credit provider=”flickr” url=”http://www.flickr.com/photos/dweekly/2850001074/”] Chinese corporate bonds fell 1.5% in August, the most since 2008, reports Shanghai Daily.On average, yields Chinese companies pay to borrow in dollars reached a 14-month high of 5.69 per cent, 35 basis points more than it was at the start of August, shows an HSBC index. […]
Chinese Corporate Bonds Are Tanking Like It’s 2008
Markets

Treasury Yields In Perspective: Weekend Update

Note from dshort: The bond market ended the week with a strong response to the grim employment report heading into the labour Day weekend. The yield on 10-year note finished the day at an all-time closing low of 2.02%.
Treasury Yields In Perspective: Weekend Update
Markets

The Real Risk

Forget about the fiscal situation for a moment.  Forget ratings, forget Budget Deficits.  Here’s the real risk that investors need to worry about. It isn’t default.  Its rising rates. 
The Real Risk
Markets

PIMCO Missed The Trade Of The Year In The Treasury Market

PIMCO who specialises in Bonds, having the largest bond fund in the world could not have been more wrong about an asset class, which is surprising considering their experience in this sector. Bill Gross’s official declaration that his firm was shorting the US Treasury Market on April 11th of this […]
PIMCO Missed The Trade Of The Year In The Treasury Market
Markets

HISTORY IN THE MAKING: 10-Year Yield Falls Below 2%

[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:American_Flags.JPG”] The huge crash we’re seeing today is prompting, once again, a huge flight into US Treasuries.For the first time ever, the yield on the 10-year is below 2%.
HISTORY IN THE MAKING: 10-Year Yield Falls Below 2%
Markets

Don’t Believe The Hype, China Won’t Be Dumping US Treasuries

[credit provider=”Flickr: U.S. Army” url=”http://www.flickr.com/photos/soldiersmediacenter/5374759561/”] Is the PBoC going to stop buying USG bonds? Once again we are hearing very worried noises from various sectors about the possibility of a reduction in Chinese purchases of USG bonds. Here is what an article the South China Morning Post said:China will press […]
Don’t Believe The Hype, China Won’t Be Dumping US Treasuries
News

Obama Cancels Planned Event, Visits Dover Air Force Base

[credit provider=”C-Span”] UPDATE: Report: Obama To View Return Of Remains Of Americans Killed In Afghanistan TodayOriginal: The White House just announced that all public events have been cancelled today, including a much-publicized appearance by President Barack Obama at a company in Springfield, VA to highlight new fuel efficiency standards.
Obama Cancels Planned Event, Visits Dover Air Force Base
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