Category Archives: Bond Market
Did anyone catch the 15%ish flash crash in the US 30 Tbond this morning –from 6:12-6:23am? The 30yr yield spiked from 2.8 to 3.37% for a few minutes. Considering the 30yr duration and avg when issued yield of 2.75% that flash crash represented a 15%ish drop in price. It looks like a stop-hunting algo went nuts taking out some stop-loss targets for 2 […] Read the rest of this entry
The plight of bonds since the beginning of the year has been making headlines. Zooming out a little, 3.2-3.3% on the 30yr was due to be tested… That jump in yields from 2.95 to 3.2% over the past 8 weeks looks small in this context. What interests me is that 2.0% is going to be tested later this year — unless central banks find […] Read the rest of this entry
And you thought I was kidding about seeing 2.0% on the U.S. long bond this year. Futures saw 2.38% this morning. Let’s zoom out…. Is the trend your friend?
Europe’s derivatives market (called Euronext) was re-set during today’s European bond market meltdown. This stopped the bloodbath and caused a reverse in course. When reality creeps in, pull the plug. SPX futures were plummeting — right up until the plug was pulled on Euronext. I could not find any mention of this on the website of CNBC nor the FT this morning. Odd […] Read the rest of this entry
A wise man posed this question this morning —- given that U.S. nominal GDP growth is roughly 4%, would the U.S. Tnote yield be this low (2.5%) had central banks not been gobbling them up? (he thinks no) My Answer: No, they would not. I’ve agreed with the wise man. If only for a few seconds. In fact, the U.S. Tnote yield would […] Read the rest of this entry
Someone forgot to tell the U.S. Tbond investor the U.S. economy is fantastic. They also forgot to tell the Tbond investor to be afraid because the Fed –the largest buyer of Tnotes & Tbonds via QE3– is backing away, and that the price of US Tnotes and Tbonds is supposed to drop. Yes, yes, interest rates are going up — the perennial refrain from […] Read the rest of this entry
Did anyone catch MUB today? I-Shares Muni Bond ETF (MUB) had a wild ride this afternoon. It’s not like this is thinly-traded. More signs the bond market sell-off is done? Probably.
(Important) Housekeeping comments: 1. We’re approaching the date when we will combine 2 weekly email letters into 1. The new letter will contain a very brief summary and website link to facilitate login and access to the entire letter (economic news and data, analysis, the greedometers, and details on the specific investments we plan to buy / sell.) 2. An interactive greedometer gauge […] Read the rest of this entry
The view presented by the greedometers still indicate April is the top for risk assets and that the economic slowdown of 2012 – 2013 began earlier this year. The US economy will probably slow to the point where it stalls completely and falls back into recession in the current quarter. The book (Greedometer. Dow 5000. Why nobody sees it coming.) will go into […] Read the rest of this entry
Every country in the G7 (except Canada) has an economy that is smaller now than it was in 2008 (before the last recession). Because of how the NBER defines recessions, it says we had one in 2008-2009, and have since come out of it. I suggest the definition include a comparison of the current economy size to that before the recession began. If the […] Read the rest of this entry