Posted on 10/03/2023 9:41:23 AM PDT by Diana in Wisconsin
The Dow fell more than 400 points Tuesday morning, turning negative for the year, as US Treasury yields surged to their highest levels in over a decade.
The Dow fell 427 points, or 1.3%. The benchmark S&P 500 declined 1.5% and the Nasdaq Composite lost 1.8%, extending the late summer selloff in stocks.
Stocks have marched higher for most of this year, as artificial intelligence excitement took hold on Wall Street and powered tech stocks to stratospheric heights.
But that rally petered out in August, as strong economic data had investors worried that a resilient economy and piping hot labor market would lead the Federal Reserve to hold interest rates higher for longer to tamp down inflation.
The Fed signaled last month that it could introduce one more hike this year and keep rates elevated through next year. Treasury yields have spiked and the US dollar has surged in the weeks since, continuing to chip away at the stock market’s gains from the spring. Stocks tend to suffer when government bond yields are elevated, since it means investors can get high returns on less risky assets.
Yields continued to rise on Tuesday, with their climb accelerating after fresh data from the Bureau of Labor Statistics showed that the number of US job openings unexpectedly soared to an estimated 9.61 million open jobs in August. That’s up from July’s upwardly revised estimate of 8.92 million openings and above the consensus 8.8 million estimate among economists.
The yield on the 10-year Treasury note on Tuesday climbed to 4.75%, its highest level since August 2007. The 2-year rose to 5.13%, around its highest level since July 2006.
CNN’s Fear & Greed Index fell to an “Extreme Fear” reading of 17, its lowest level since last October.
(Excerpt) Read more at channel3000.com ...
Nobody's listened to them since 1988
Why doesn’t anybody tell me these things?
E. F. says buy DWAC..
Don't worry, I'm sure your account with Bernie is doing just fine, you are still getting statements?
“Blue Horseshoe Loves Anacott Steel”
It has very little to do with the average American, if you look at how banks operate.
You're also "cherry picking" your DXY dates - since it's now higher than it was in the 90's.
Why did the dollar spike around 2000? Because of the economic crisis called the "Dot Com Bubble".
The US dollar always spikes in deflationary times - which is what we're currently in and it will be getting worse.
Yes, the DXY measures against a basket of other currencies. When DXY goes up it indicates that the "factory nations" are struggling. China is the largest factory nation and it's in its economic death spiral right now.
If you believe the opposite from me then stock up on gold, silver, and oil.
If you believe in deflation then I wouldn't hold those things at all. They're just commodities that will be dropping. Oil was only going up because of drastic OPEC supply cuts. Without that, it would be in the $50 dollar range.
My last buy was 5.35% a week ago.
Bull....
(for those who remember the commercials...)
I'm doing a laddering strategy with them. Buying 1/4 of my portfolio every week and have 1/4 maturing.
I just keep reinvesting through Treasury Direct.
That way I alway's have 1/4 of my assets very liquid, with the other 3/4 pretty liquid as well.
When deflation finishes taking its toll then those with cash will find great deals. That's what I'm waiting for, and sitting on the sideline in treasuries until then.
4 week t bills here as well.
Every Tuesday money comes in and money goes right out in new bills.
Exempt from state taxation as well.
It's nice to watch all of this from the sideline while still getting great interest. My monthly interest from t-bills more than pays for my mortgage.
Yep - auctions on Thursdays and settlements the following Tuesday. Like clockwork.
I am also buying them through Treasury Direct.
I have a mix of 26 week, 13 week and 7 week. My most recent purchase was a 26 week I set up to reinvest 3 times.
Six months ago the 7 week were the highest rate.
They amount to about 7% of my portfolio. The rest is in mostly small cap mutual funds and a couple stocks that I wish I had sold.
I saw where the Russell 2000 just went negative for the year. Small caps are telling the true story of the economy, and it's not good.
Up to 5.7 today.
Yes, I know.
My 401K peaked 6 months into Bidens term. Went down until this past winter. Went up until a couple months ago.
Next year might be a good time to buy a second hand boat or a used sports car. When people need to start dumping assets to pay rent/mortgage.
I don’t see anything higher than 5.34% on Tbills:
https://treasurydirect.gov/auctions/announcements-data-results/
From my Schwab account.
Not an auction.
CUSIP 912797GZ4
Security Type U.S. Treasuries
Maturity Date 04/04/2024
Coupon Rate 0.000%
Coupon Type Fixed
Coupon Frequency —
Accrual Day Count Act/360
Dated Date 10/05/2023
First Settlement Date 10/05/2023
First Coupon Date —
Next Coupon Date —
Original Issue Discount 97.300333
DTC Eligible Yes
Evaluated Price 97.300333
Call / Put / Sink Features
Call Type —
Call Method —
Call Details No Cash Call Identified
Call Notification Days —
Next Call Price —
Next Call Date —
Call Schedule —
Survivor’s Option No
Quote Details Bid Ask
Price 97.299 97.304
Current Yield 0.000% 0.000%
Yield To Maturity 5.582% 5.572%
Yield To Call — —
Yield To Worst — —
Available Quantity 5000 15000
Trade Min/Increment 1 / 1 1 / 1
Security Min/Increment 1 / 1 1 / 1
Price Details Price based on 25 bonds and a settlement date of 10/05/2023
I sit here remembering how I once wondered how a rise from 6.3% to 6.6 % on our new inventory loans could be managed
the bond vigilantes are back this wont be pretty
Seems quaint now......................
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.