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Commentary: Black-swan crisis warning for now through mid-April. SAN LUIS OBISPO, Calif. — Global risks are accelerating. This is our fourth major poll update of industry leaders: A critical review of their warnings from early last year when we first predicted a 87% risk of a crash: Bernanke’s Fed saw an “unsustainable bubble” ... Gross: “credit supernova” ... Gundlach: “kaboom ahead” ... Ellis: “Don’t own bonds” ... Shilling: “shocker” ... Roubini: “Prepare for perfect storm” ... Shiller: “Irrational exuberance is back” ... Schiff: “Doubling down” on “doomsday” prediction ... InvestmentNews’ warning 90,000 advisers: “tick, tick ... boom!”

WASHINGTON — The Federal Reserve announced Wednesday another $10 billion cut in its monthly bond purchases in a statement that attributed the decision to “growing underlying strength in the broader economy.” The statement, published after a two-day meeting of the Fed’s policy-making committee, reflected the optimism of Fed officials that the economy is finally poised for faster growth after years of false starts and setbacks. It was the committee’s first unanimous decision since 2011. The Fed said it would expand its holdings of Treasury and mortgage-backed securities by $65 billion in February, down from $75 billion in January and $85...

SPRINGFIELD, Ill. (AP) -- Fitch Ratings has downgraded the credit worthiness of Chicago's bond debt because of its public pension problems. Fitch dropped the rating from AA- to A- on $8 billion in general obligation bonds, backed by property taxes. It also dropped the rating on $497 million in sales tax bonds — paid for by both the city's local sales tax and its share of the state sales tax.

Last year’s payments on the city’s general obligation debt represented 12 percent of all government expenditures and ate up 63 percent of property taxes collected."When municipal officials want to build for the future, they have a powerful financial tool at their disposal: general obligation bonds that yield millions of borrowed dollars. The money is meant to let cities move forward on costly projects that will serve the community for decades.But in an unprecedented analysis of Chicago’s finances, a Tribune investigation found that city officials have long abused their borrowing privileges, spending funds meant for long-term initiatives on problematic short-term...

Although politicians and the press have generally referred to what has been happening in the federal government since Tuesday, Oct. 1 as in a “shutdown” or “partial shutdown,” that did not prevent the U.S. Treasury from being open for business on Thursday—the third day of the “shutdown” and issuing $106.291 billion in new debt, according to the Daily Treasury Statement released at 4:00 p.m. on Friday. … Even though the net debt held by the public declined by $5.039 billion in Thursday, and the cash reserved declined by $33.080 billion, according to the Daily Treasury Statement, the same statement said...

Friday is the fourth day after President Obama and Senate Majority Leader Harry Reid shut down the Federal government. Both President Obama and Reid said they refuse to negotiate with the House of Representatives. obama a The US Treasury 10 year yield is actually up 4 basis point on Friday and up 3.5 basis points for the week. ust10100413 The Dow INDU index is down slightly since the shutdown began (but up 76 points on Friday). indu100413 Gold is down 1.99% over the course of the last five days. gold100413 US Dollar-Euro exchange rate is almost back where it started...

Driven on the Intercounty Connector lately? No? You’re not alone. Many haven’t. The 18.8-mile highway—the first stretch of which opened two and a half years ago after great hype and amid great controversy—is the road less traveled. Traffic counts are well below early projections, and revenue from tolls—needed to pay off the bonds that were sold to build the road—is far less than originally anticipated. The initial estimated cost of $1 billion has ballooned to $2.4 billion—or as much as $4 billion if you include interest payments. Consequently, all tolls on Maryland highways, bridges and tunnels have been raised in...

This much has been determined yesterday -- The Fed could not handle a 2.8% 10 year Treasury rate. Nor could it handle any further increases. But consideration of the impact of this policy on the common man, along with the destruction of purchasing power and outright theft from the people who produce the services (and few goods remaining) in this nation was damned -- exactly as has been the case for the last three decades. What Bernanke did yesterday was guarantee a crash. He guaranteed it because he took what was a clear opportunity to take what had been priced...

NEW YORK (MarketWatch) — Treasury prices tumbled on Thursday as the benchmark 10-year note yield pushed to the brink of 3%, a psychological threshold emblematic of its sharp climb since early May.

The Federal Reserve will lose control of interest rates as the "great rotation" out of bonds into equities takes off in full force, according to one market watcher, who sees U.S. 10-year Treasury yields hitting 5-6 percent in the next 18-24 months. "It is our opinion that interest rates have begun their assent, that the Fed will eventually lose control of interest rates. The yield curve will first steepen and then will shift, moving rates significantly higher," said Mike Crofton, President and CEO, Philadelphia Trust Company told CNBC on Wednesday. "If the great rotation that everybody talks about out of...

The first officially recorded municipal bond was issued by the City of New York for a canal in 1812. It was a general obligation bond, meaning the city pledged every available resource – most notably, tax revenue – to repay the debt. So, in theory, unless the city lost its legal ability to levy taxes, which it never would, investors would be repaid... If Orr succeeds, look for all hell to break loose. Just like we witnessed during the real estate collapse when homeowners started walking away from their mortgage obligations without any recourse, other cash-strapped municipalities are destined to...

The Securities and Exchange Commission accused Miami and its former budget director of securities fraud related to several municipal bond offerings. The city and Michael Boudreaux made materially false and misleading statements and omissions about interfund transfers in three 2009 bond offerings totaling $153.5 million, the SEC said in a statement Friday. Boudreaux orchestrated the transfers to mask growing deficits in the city’s general fund, the SEC said. The SEC in 2010 started cracking down on state and local governments for not providing investors in the municipal bond market with accurate information about pension liabilities. Since then, Illinois and New...

Fed Chairman Ben S. Bernanke will have a Q&A following the release on the Fed’s FOMC minutes today at 2pm EST. Here are the minutes. Quick summary of the last FOMC meeting: half the voting members want to stop asset purchases later this year. The other half, wait for improving economic conditions. The reaction in the 10 year Treasury yield? t10reaction But prior to his Q&A session, the 10 year Treasury auction went off as expected. trreas10yraux The 10 Year High Yield continues to climb. ust10ihg The 30 year auction is tomorrow. Stay tuned!

The Trigger Has Been Pulled And The Slaughter Of The Bonds Has Begun By Michael Snyder June 25th, 2013 The Bears Are Unleashed On Wall StreetWhat does it look like when a 30 year bull market ends abruptly? What happens when bond yields start doing things that they haven't done in 50 years? If your answer to those questions involves the word "slaughter", you are probably on the right track. Right now, bonds are being absolutely slaughtered, and this is only just the beginning. Over the last several years, reckless bond buying by the Federal Reserve has forced yields down...

Has the Great Financial Crisis Finally Arrived? Stock-Markets / Credit Crisis 2013 June 23, 2013 - 05:33 AM GMT By: Graham Summers The technical damage from yesterday’s bloodbath was severe. Spain, which lead the “Europe is saved” party from the lows last year has just taken out its trendline. So much for the “crisis is over” proclamations. We’re heading back down in a big way. The S&P 500 has also taken out its trendline. QE Forever is dead and buried. What will hold the market up now? Copper is indicating that the entire post-2009 “recovery” is ending. We’re moving back...

U.S. Treasury Bond Market Implosion Has Officially Begun Interest-Rates / US Bonds June 21, 2013 - 06:02 PM GMT By: Graham Summers The QE Infinite parade officially ended yesterday when Bernanke hinted at tapering QE later this year or in mid-2014. I first warned about this in mid-May writing, "If Bernanke is going to step down (as hinted by his decision to skip out on the Jackson Hole meeting) he’s not going to want to leave with the Fed going at QE 3 and QE 4 full throttle. Instead his best bet would be to take his foot off the...

St. Louis Federal Reserve Bank President James Bullard worried that the Fed's decision earlier this week to announce a plan to reduce bond buying was poorly timed, the regional Fed bank said in a statement on Friday explaining his dissent. "President Bullard ... felt that the committee's decision to authorize the chairman to lay out a more elaborate plan for reducing the pace of asset purchases was inappropriately timed," the St. Louis Fed's statement said. Bullard was one of two dissents cast on Wednesday by members of the U.S. central bank's policy-setting Federal Open Market Committee. The other dissent, by...

Gold, Silver, Stocks, Bonds Plunge On Fed Noise And China Debt Crisis Risk Commodities / Gold and Silver 2013 Jun 20, 2013 - 04:14 PM GMT By: GoldCore Today’s AM fix was USD 1,303.25, EUR 986.34 and GBP 842.38 per ounce. Yesterday’s AM fix was USD 1,366.00, EUR 1,019.86 and GBP 874.91 per ounce. Gold fell $16.10 or 1.18% yesterday and closed at $1,351.00/oz. Silver sank to $21.25 and ended down 1.25%. Bonds, shares plus gold and silver fell sharply around the world this morning after the U.S. Federal Reserve again suggested an end to their easy money policies. Data...

Global Recession Forecast - Is PIMCO's Bill Gross Wrong Again? Stock-Markets / Financial Markets 2013 June 17, 2013 - 05:01 PM GMT By: Money Morning Keith Fitz-Gerald writes: Stuart Varney put the question directly to me last week during his Fox Business show: What do I make of comments from PIMCO's Bill Gross...that he's projecting a 60% chance of a global recession in the next three to five years? Now, Bill Gross is obviously one of the most powerful men in the world. PIMCO, the firm he founded, is the world's biggest bond manager. He has assets under management of...

JIM O'NEILL: We Could See A Bond Crash Steven Perlberg Jun. 14, 2013, 12:33 PM As the market speculates on when the Fed will begin to slow its quantitative easing program, former Goldman Sachs Asset Management chairman Jim O'Neill isn't alone in believing a taper would mean turbulence for financial markets. But for O'Neill, it would also "not be a stretch" to see 5% yields on the 10-year Treasury, reports Bloomberg. Given the 10-year's current 2.11% yield, that would imply a big sell-off in the bond market. O'Neill talked about that — and his prediction for a bond crash —...