He's dead, Jim
Posted on 12/05/2008 9:14:04 PM PST by djf
The problem: the settlement system for the US government bond market has broken down
THE US TREASURY market, the foundation of government bond and corporate bond markets worldwide, is suffering a crisis of confidence at the worst possible moment. Investors in treasuries are the lenders enabling the US government bail-out of the country’s broken financial institutions. That leaves them financing purchases of equity of volatile and highly questionable worth and backing a ragbag of distressed assets. For now, treasury yields are at record lows across the term structure as investors with cash to invest conclude that they can trust no one else with their money. But investors must wonder at what point the expanded supply of government debt and its use will make the borrower inherently less creditworthy.
There is an even more pressing concern for many participants in this increasingly swollen market: the settlement system has broken down. Following the collapse of Lehman Brothers in September, fails to deliver among the 17 primary dealers in the US treasury market have rocketed to more than $2 trillion over a period of weeks and still lie above $1.3 trillion. Broker/dealers have stopped delivering bonds. Holders of US treasuries are now scared to lend into the repo market in case their bonds are not returned, and potential buyers sit on the sidelines fearful of handing over their money to a counterparty that at best might not deliver a bond on time, and at worst might go under.
(Excerpt) Read more at euromoney.com ...
FTD's amount to YET MORE COUNTERFEITING by the shysters!
People were left literally breathless by this week’s action in the Treasury Market. Some nearly came to blows as well. If you watched the hi-strung discussions between Rick Santelli vs. Steve Liesman you know what I mean.
The Federal Reserve’s international creditors, the ones that have been financing America’s $10 trillion national debt, called in their loans, a move that threatened the very solvency of the U.S. dollar.
LOL. The contradiction is priceless.
“Might” figures heavily in this article. It’s from a European source and I wonder how much wishful/fearful thinking is driving this.
later
Of course we wonder about the motivations of the Europeans.
But then I wonder about the truthfullness of the Fed.
They got ya coming or going!!
They used to throw people in jail for selling snake oil.
Now they get promotions and bonuses.
Do you have a link for that?
“Could US pension funds bail us out with some incentive?”
They should be next to wortless in another 6 months.
The pension funds invested in the market just like everyone else....they are lucky if they have enough to cover current requirements....let alone the babyboom retirement bubble coming up.
I don’t have the link for the latest one. It was quite the gunslinger video with Rick even doing a pirouette at the end. I know that if you search YouTube for “Rick Santelli” you will see lots of them, but I don’t know how to identify the latest (except by scanning through the dates).
Was given this link today. Initially, I thought this guy must be over the edge, but I did get anxious .. it’s so shocking, dramatic and drastic. Now I wonder, especially after the report of the Nat’l Guard being deployed to cities.. am I nuts or is he? Lord, save us.
http://www.youtube.com/watch?v=VG0fu2YXeKA
Related:
December 5, 2008
Assessing Plans to Deploy U.S. Military on the Homeland Security Front
http://www.heritage.org/Research/HomelandSecurity/wm2156.cfm
I know what you mean. And if you make one payment to your credit cards a day late you’re paying 27-30% interest. How did that become allowable? That would seem like a loan shark implementing illegal rates to me.
Be ready to do for yerself. It may take a wheel barrel of money to buy a loaf of bread in the near future
The Federal Reserve doesn't borrow money.
Ping.
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