Posted on 03/02/2020 5:25:59 AM PST by zeestephen
And I can remember my grade,school passbook savings account that paid 4% in 1958.
Does this mean little ole me can borrow money and I will be paid soon ???
Must be the best time ever to own rental properties. Hot rental market. Cheap financing/refis. Plunging commodities prices over the past week will lower the cost of renovations.
Time to refi your home!
This is indicative of the strength of our economy versus the rest of the world.
The world economies with greater reliance upon the Chinese recognize that the economic contagion will be more severe due to reliance upon China.
This is why we must continue to de-couple from China. Depending on a communist government must cease.
Why would anyone buy the 10 Year at 1.04 when they can buy the 3 Month at 1.18?
The only possible reason is speculation - you think interest rates will drop further, and when they do, you can sell your bond for a profit.
Axiom: Interest rates and the price of the bond always move in opposite directions.
So, a negative interest rate indicates a strong economy?
The interest rates can’t be raised, who is the biggest borrower?
Re: Does this mean little ole me can borrow money and I will be paid soon ???
Only if your legal name is U.S. Treasury.
>>>Why would anyone buy the 10 Year at 1.04 when they can buy the 3 Month at 1.18
If you think the rate on the 3-month when you roll it over is going be less than 1.04%, it could make sense to have the 10 year.
This is a huge signal that the Federal Reserve should have lowered their rates a long time ago. The Fed is hurting the economy as usual.
Apparently - and also - news flash - apparently the FED pumping in tens or hundreds of billions of dollars into the repo markets to keep it from collapsing, while the stock market is reaching ATH's, also indicates a strong, stable, economy and financial system.
This is a signal for the leftist lemmings to start crying “recession.”
>>>This is a huge signal that the Federal Reserve should have lowered their rates a long time ago.
How does lowering interest rates solve a supply side issue if not being able to get product out of China?
How does keeping short term rates artificially way above the market rate help the economy?
Date 1 Mo 2 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr
02/28/20 1.45 1.37 1.27 1.11 0.97 0.86 0.85 0.89 1.03 1.13 1.46 1.65
No rational person could possibly believe that a 1.04% annual return for ten years would be a good investment.
You can stay in cash and get 1.3% on an overnight sweep account.
The only people buying the 10 Year today are gamblers.
Im refinancing my Moms house right now. We have been successfully riding an adjustable loan on our home for 15 years. Just got our adjustment letter last week and we are getting a nice payment reduction.
It is first important to understand what is negative on the 10 yr treasury. The coupon rate is not negative. The yield is negative.
There is a huge difference.
This is supply and demand. If the coupon rate is set and people are willing to get a negative yield that is due to so many people bidding up the price and driving down the yield.
Here is an explanation
Bond Yield Rate vs. Coupon Rate: An Overview
A bond's coupon rate is the rate of interest it pays annually, while its yield is the rate of return it generates. A bond's coupon rate is expressed as a percentage of its par value. The par value is simply the face value of the bond or the value of the bond as stated by the issuing entity. Thus, a $1,000 bond with a coupon rate of 6% pays $60 in interest annually and a $2,000 bond with a coupon rate of 6% pays $120 in interest annually.
I hope that helps.
https://www.investopedia.com/ask/answers/051215/what-difference-between-bonds-yield-rate-and-its-coupon-rate.asp
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.