Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Thursday, July 08, 2010
State of the European Banking System / Interest-Rates / Euro-Zone
By: STRATFOR
Summary -
In the last six months, the eurozone has faced its biggest economic challenge to date — one sparked by the Greek debt crisis which has migrated to the rest of the monetary union. But well before the sovereign debt crisis, Europe was facing a full-blown banking crisis that did not seem any closer to being resolved than when it began in late 2008. With investors and markets focused on European governments' debt problems, the banking issues have largely been ignored. However, the sovereign debt crisis and banking crisis have become intertwined and could feed off each other in the near future.Read full article... Read full article...
Thursday, July 08, 2010
ECB Urges Bank Recapitalizations / Interest-Rates / Credit Crisis Bailouts
By: Axel_Merk
European Central Bank (ECB) President Jean-Claude Trichet, in his press conference following the central bank’s monthly meeting, built on the more confident tone set in recent weeks. Mr. Trichet suggested improved market conditions are a reflection of the decisive and constructive actions taken by eurozone governments.
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Thursday, July 08, 2010
The Case For U.S. Treasury Bonds Rally / Interest-Rates / US Bonds
By: Guy_Lerner
With the economy softening and the Federal Reserve unable to provide a positive catalyst in the form of lower rates, the bond market has taken up of the slack producing lower yields. For example, mortgage rates have dropped over the past month enticing homeowners to refinance. It may not clear the glut of homes on the market or get us back to the old days of your house as an ATM machine, but lower rates do help. This appears to be a trend that will continue especially since Washington and the Fed no longer have the political will to expand the deficit.
Wednesday, July 07, 2010
You're Crazy to Hold Government Bonds... Here's a Safer, Growing Yield / Interest-Rates / US Bonds
By: DailyWealth
Dan Ferris writes: Investors are scared.
During the week of June 23-June 30, the American Association of Individual Investors Survey indicated investors are much more fearful than usual. On average, 31% of individual investors are bearish. These days, 42% of investors are bearish. On average, 39% are bullish. Today, just 25% are bullish.
Wednesday, July 07, 2010
Municipal Finance Pathologies Come to a Head / Interest-Rates / US Bonds
By: Fred_Sheehan
Discussions about municipal finance generally assume three absolute conditions. First, the principal and coupon of municipal bonds are guaranteed: "Municipal bonds don't default," according to trusted experts. Second, the guarantees are backed by the taxing authority of the state or municipality. Third, accrued pension benefits are guaranteed.
Wednesday, July 07, 2010
Fed Audit Failure Lends Credence to QE Rumors / Interest-Rates / Quantitative Easing
By: Dr_Jeff_Lewis
Just last week, Congress had a critical piece of legislation before it. Congress, through House bill HR 1207, could pass the bill in its entirety with a simple majority vote, and it would be included in the Financial reform overhaul bill which is currently being pushed through Congress. Should the audit bill have been added to the financial reform legislation, upon passage, the books at the Federal Reserve would be opened for audit by the GAO – at which point every citizen, politician, and investor would know within six months the extent of the actions taken by the Fed over the past 97 years of pure secrecy.
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Tuesday, July 06, 2010
Inflation Isn’t Dead, Just Sleeping, Protect Your Wealth With TIPS / Interest-Rates / Inflation
By: Money_Morning
Larry D. Spears writes: Investors are always on the lookout for hot tips. The best tips highlight investments that pack a big potential profit punch, but that haven't yet started their move.
That's just what we have for you here.
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Monday, July 05, 2010
U.S. Treasury Bonds Rally on Disturbingly Weak Fundamental Data / Interest-Rates / US Bonds
By: Levente_Mady
The bond market was stronger again last week as bonds rallied with help from more, persistent disturbingly weak fundamental data and an equity market that is still in search of a bottom.
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Friday, July 02, 2010
The Link Between Public Debt and Private Wages / Interest-Rates / US Debt
By: Adrian_Ash
BETWEEN V.E. Day in 1945 and June 1947, the United States shrank its armed forces from twelve million people to around 1.5 million.
The impact on the economy – and on the US Treasury's then record debts – is hard to overstate...
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Friday, July 02, 2010
Euribor’s Wobble, How Nervous Should We Be? / Interest-Rates / Euro-Zone
By: Seven_Days_Ahead
Since the beginning of May, Euribor has traded in a clearly defined sideways pattern. Our analysis of this contract had broadly been that it had little room to rally further due to the economic recovery clearly underway, but no reason to turn into a bear market yet since that recovery was still too fragile.
Thursday, July 01, 2010
US Treasury Bond Holders Have Nothing to Fear today, Just Look How Low Yields Are! / Interest-Rates / US Bonds
By: Adrian_Ash
"BOY, the bond vigilantes are really on the warpath," jokes Paul Krugman, noting in his blog at the NY Times that 10-year Treasury yields ended Tuesday below 3.0%.
Thursday, July 01, 2010
Municipal Bonds Crisis, I Get A Pat On the Back From Warren Buffett / Interest-Rates / US Bonds
By: Graham_Summers
Back in February 2010 ago, I wrote an article titled, The Municipal Bond Crisis is About to Begin. The main points presented in that piece were all based on simple common sense. The were:
- Most state governments are broke or in the process of going broke
- Tax receipts were falling (so less money for state coffers)
- Muni bonds would collapse as governments chose to default rather than honor their payments
Wednesday, June 30, 2010
Eurozone and U.S. LIBOR Interbank Interest Rates Divergence / Interest-Rates / Credit Crisis 2010
By: Paul_L_Kasriel
A Tale of Two Cities - New York vs. Frankfurt - Chart 1 shows the recent behavior of the 3-month interbank loan rates in U.S. dollars and euros. Both in dollar and euro terms, these interest rates began drifting up in the second half of April as the Greek, Portugal and Spain (GPS) sovereign debt challenges came to the fore. If GPS were to default on its sovereign debt, this would have an adverse impact on some European banks. These potential losses for European banks caused interbank lending to "tighten up," thereby driving up interbank loan rates.
Tuesday, June 29, 2010
Facing Debt Reality, Most of the So-called Developed World is Broke / Interest-Rates / Global Debt Crisis
By: David_Galland
by David Galland, Managing Editor, The Casey Report writes:
Scanning through a local newspaper this week, I came across a letter to the editor that speaks volumes about the popular misconceptions that are dragging this country, and the world, to its knees.
Tuesday, June 29, 2010
Four Reasons Why the Fed Will Try Quantitative Easing / Interest-Rates / Quantitative Easing
By: Dr_Jeff_Lewis
While we were led to believe that the Fed would begin tightening upon recovery, new fears of a double dip have sparked the Keynesian clan into moving in the opposite direction. Soon enough, we believe, a new quantitative easing program will be unveiled.
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Tuesday, June 29, 2010
The Social Function of Credit Default Swaps / Interest-Rates / Credit Crisis 2010
By: Philipp_Bagus
Whenever the government causes a mess, chances are high that it will accuse speculators of being responsible.[1] In the recent financial crisis, speculators and their financial instruments have been under attack again. Some famous investors have even supported governments' attacks on speculators. Warren Buffet has called derivatives "financial weapons of mass destruction."
Monday, June 28, 2010
Fed Credit, Inflation and the Idiots in the Middle / Interest-Rates / US Debt
By: LewRockwell
A whole series of alarms occurred after I got the news, although I lost the source, that “food stamp usage just soared to a new record high” of 40.2 million persons.
This number is alarming in itself because it means that the economy is so bad that more and more hungry people cannot afford to even feed themselves, sort of like teenagers, but with hopefully better manners and dietary choices.
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Monday, June 28, 2010
Weak Economic Data Sends Treasury Bond Prices Higher / Interest-Rates / US Bonds
By: Levente_Mady
The bond market was stronger last week as bonds rallied with help from disturbingly weak fundamental data and a fading equity market. The final release of the first quarter GDP figure was revised down from the first cut of 3.5% to 3.0% on the second look and finally to 2.7% on last week’s figure. Honestly it is beyond me how consensus can still be looking for 3-4% growth during the second half of 2010 in the US and Canada! From my vantage point we will be lucky to print a positive number by the last quarter on either side of the border. The front end of the economy is in shambles, the Fed is out of easing bullets as it is already at 0% and the newly found fiscal responsibility across the globe is certainly highly advisable but its short term impact will most likely be quite painful.
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Friday, June 25, 2010
U.S. Treasury Bond TLT ETF Pressuring Resistance / Interest-Rates / US Bonds
By: Mike_Paulenoff
The iShares 20+ Yr T-Bond ETF (NYSE: TLT) continues to trade in a high-level coil-type pattern that is putting increasing upward pressure on the 100.00 resistance plateau amidst deteriorating economic data, an uncertain business environment, and defensive equity markets.
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Friday, June 25, 2010
When It Comes to Increasing Aggregate Demand, What's Fiscal Policy without Monetary Policy? / Interest-Rates / US Interest Rates
By: Paul_L_Kasriel
Not much. Suppose the central government decides to increase spending without increasing taxes. Where do the funds come from? From entities who are willing to lend. If those lending entities are the nonbank public, for the most part, all this does is transfer spending power to the central government from these entities. Net, net, total spending in the economy does not increase. Rather, there is just a change in the distribution of spending.
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