[knarf]

"The sign that this risk is becoming real will be when the US Treasury bond market starts to trade on supply dynamics, in terms of the amount of bond issuance, as opposed to the perception of the health of the economy"

I understand the perception of health, but not the other.

Explain, please?

[joelt]

After the Fed stops buying US bonds with the Monopoly money it is printing (June or so?) Will there be enough demand from other buyers to take up the slack. If not, then interest rates will head where everyone knows they need to go.(up!) 2008 all over again.

[mlocher]

Explain, please?

I had the same question about "supply dynamics." I do happen to believe that our rates are low because compared to other gov't issued bonds, the US appears to be relatively safe (healthy). But this is not a perception of the health of the ecnomy -- it is a perception of the relative health of the economy.