Posted on 11/03/2010 12:01:44 PM PDT by blam
Don't Look At What Just Happened To 30-Year Treasuries
Joe Weisenthal
Nov. 3, 2010, 2:28 PM
Oof. Check out 30-year futures on the QE news.
Turns out that buying at the long-end will be very minimal. Most is at the 2-10 year range.
[snip]
(Excerpt) Read more at businessinsider.com ...
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So for you financial folks, does this mean we can expect to see another round of mortgage rate reductions?
Can I have 1% of the 600 Billion?
I know this is dynamic, but how much inflation will this generate...Savings and retirement I guess are going to be Scott Tissue...
We were just robbed....
Just the opposite. That is the price of a 30-year bond. When the price goes down the interest rate goes up and vice versa. Chairman Ben "Weimar" Bernanke's magical money machine will cause medium and long term interest rates to go up because bankers around the world realize that dollars in the future won't be worth as much as they are now. Short term rates are controlled directly by the fed, thus no longer have any connection to economic reality.
Collapse!!!
I just sent a note to my boss saying that I want my commission check on the $4 million of product that I just sold to myself and then sold back to the company. I just stimulated the economy and because the top salesman in my company’s history.
See, look how easy it is! Thanks for showing me how it’s done, Mr. Bernake.
They dropped forty-six cents, blam, from $131.80 to $131.34.
Those graphs, if you go to the original source, usually allow expanding the timeframe beyond four hours. What looks significant sometimes is misleading, especially at tiny increments.
What is this saying about the Republican victory? This is the futures market not current interest rates and speculators can be wrong or just not sure they should be buying.
Blam...They basically have a control panel there at the Fed. if something goes the wrong way then they can crank a dial or flip a switch, and it will come back to what they want. The phone calls go out to the central banks, the Big banks, hedge funds- The money flows through the fed funds and purchases and gets directed however the fed may decide with some profit left in the action for the one who plays nice with the fed. A rumor here, a rumor there. They have the whole thing in the palm of their hands. There is not much natural about the markets or the debt anymore.
In the end the game will fail. But who knows how long they can keep it up.
I don’t know about that. If you look at how much work is being offshored, you can see that whole professions are going to be wiped out. The “displaced” will then compete for the remaining work, thus further devaluing American labor. Dump in the swarming illegal aliens and H1B’s and I think we’re going to hit a tipping point where American salaries begin to fall precipitously across the board. It will be hard to drive up prices when people are worried about trying to eat and stay warm. Of course the end result is the same: the American standard of living you and I have known is a thing of the past (at least for the masses).
Mortage rates are tied to the 10 year bond, not the 30. A 30 year fixed mortgage has lately been about 1.875% higher than the yield on the 10 year bond. I’ve seen spreads as low as 1.4% during the boom, and 2.2% during the crisis.
Example:
10 year bond: 2.50%
30 yr rate: 4.375%
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