Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Monday, September 29, 2008
China and the Middle East to Finance US Treasury Bailout? / Interest-Rates / Credit Crisis Bailouts
By: Mike_Shedlock
The Wall Street Journal is reporting Financial Troubles Humble U.S. The U.S. is turning to foreign governments and other overseas investors to buy a good chunk of what could total $700 billion in Treasury debt expected to finance the bailout. Foreign investors also are needed to shore up the depleted capital of the nation's financial institutions, seen in the plan by Japan's Mitsubishi UFJ Financial Group to buy a large stake in Morgan Stanley, which is weighed down by bad debt and market distrust.
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Monday, September 29, 2008
Escalating Bailout Band-aids Hit US Treasury Bonds / Interest-Rates / US Bonds
By: Levente_Mady
Bonds traded mostly in negative territory all last week. It looks like it is just regular business these days: another week, another bail-out package. The figure that is bandied about for the latest and greatest deal is a cool $700 Billion. It is just another band-aid in a series of larger and larger band-aids that hopes to provide quick relief for the symptoms of this gigantic financial crisis without addressing the real problem of dealing with the excess credit that has been built up on the consumer, corporate and government fronts. It will be raining Treasury bonds in the foreseeable future, so it is no wonder that the increasing weakness on the fundamental front is not providing much support for lower yields in the long term maturities at this juncture.Read full article... Read full article...
Sunday, September 28, 2008
Mega-Trend: End of the Era of Falling Interest Rates / Interest-Rates / Global Financial System
By: Boris_Chikvashvili
Dear Reader,
In early CAPI(SOPI)TALISATION process of USSR/RUSSIA, they have searched the earth for a nice motto for a newly minted credit card called RUSSIAN EXPRESS. Their search has finally ended when they DISCOVER(ed) the AMERICAN EXPRESS ad with a motto: Do Not Leave Home Without It.
And Bingo. The choice was uncontested. The motto became...
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Saturday, September 27, 2008
Credit Markets Hit by Category 5 Financial Hurricane / Interest-Rates / Credit Crisis 2008
By: Money_and_Markets
Mike Larson writes: I'll never forget Hurricane Jeanne, which struck Florida four years ago this week.
My wife, young daughter, and I huddled in the shower of our older house as the battery-powered TV flashed tornado warnings and updates on the storm's 115-MPH winds.
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Friday, September 26, 2008
WaMu Goes Bust- The Credit Market Is CLOSED! / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
Minyanville Professor Bennet Sedacca is the brightest fixed income mind I know. Inquiring minds are tuning in to see his take on the Credit Rout for Wachovia, WaMu .
Welcome to the credit market, folks, it is officially closed.
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Thursday, September 25, 2008
Credit Stress Interbank Money Market Freeze Evident In TAF, Ted Spread, Everywhere / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
Credit dislocations continue to fester. Evidence can be found in corporate bonds, preferred shares, hybrids, the Ted Spread, and even in the most recent Term Auction Facility (TAF) auctions. Let's take a look. Inquiring minds are looking at a chart of the Ted Spread.
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Wednesday, September 24, 2008
Credit Crisis Bailout- Bill Gross Should be Ashamed of Himself! / Interest-Rates / Credit Crisis Bailouts
By: Chip_Hanlon
I just got the chance to read the op-ed penned by Pimco's Bill Gross in this morning's Washington Post. Wow, have you read this mess?
He did get one thing right, and he backed up his math well enough: the government could potentially make some money on this plan by buying up securitized debt instruments at deeper discounts than they should otherwise be trading. But that actually points to a key, lynchpin part of the problem: mark-to-market accounting is undoubtedly preventing many free-market speculators from purchasing such securities today due to what it would immediately do to their balance sheets. Thus, government may get to scoop up this paper at a deeper discount than is warranted due to its own accounting rules! Ay, yi yi.
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Monday, September 22, 2008
Recommendation to Congress Not to Spread Financial Panic / Interest-Rates / Credit Crisis Bailouts
By: Money_and_Markets
Martin D. Weiss writes: The proposal before Congress for a $700 billion mega-bailout is far too little to repair the damaged debt and derivatives markets ... and, at the same time, far too much for investors and taxpayers who must put up the money.
How big is the problem, really?
In the past, Congress has repeatedly asked us for data and analysis on these issues, and we have provided it in Congressional testimony and white papers. In that same tradition, below is a partial first draft of a white paper we will be submitting on this matter:
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Monday, September 22, 2008
US Treasury Bonds Experience Massive Volatility / Interest-Rates / US Bonds
By: Levente_Mady
Along with the rest of the financial markets, the US Treasury market experienced massive volatility during the past week. The Long Bond future traded up over 5 points before ending the week almost unchanged. The 30 year Treasury bond yield traded below 4%, which is the lowest level in over 40 years. Even more significantly, the US 3 month Treasury Bills yielded less than 0.1% for a couple of days as financial markets threatened to seize up. All of the sudden drawing comparisons – even in the main stream media - with the 1990s Japanese depression and the Great Depression of the 1930s does not seem so far fetched any more. It took us years if not decades to get into this mess, I expect it will take a little longer than 3 to 6 months to get out! Read full article... Read full article...
Sunday, September 21, 2008
Bush Seeks Dictatorship Powers / Interest-Rates / Government Intervention
By: Mike_Shedlock
Bloomberg is reporting Treasury Seeks Authority to Buy Mortgages Unchecked by Courts .
The Bush administration sought unchecked power from Congress to buy $700 billion in bad mortgage investments from financial companies in what would be an unprecedented government intrusion into the markets.
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Saturday, September 20, 2008
Incompetent Paulson Talks Up Price of Mortgage Backed Securities / Interest-Rates / Credit Crisis 2008
By: Michael_Pento
I hope those who want to sharpen their skills at the art of negotiations are watching Hank Paulson and learning exactly what not to do. Rule number one when entering into a bargaining agreement to purchase an asset is: DO NOT commit to purchasing the asset before negotiating a price. Makes sense, right? Read full article... Read full article...
Saturday, September 20, 2008
Financial Armageddon and the Re-pricing of Collateralized Debt / Interest-Rates / Credit Crisis 2008
By: John_Mauldin
- Pricing in Financial Armageddon
- Inside a RMBS
- Ratings to Collateral to Ratings: A Vicious Cycle
- This Too Shall Pass
My Dad used to tell me there is no accounting for standards when looking at something that seemed odd. Today, we have faulty standards for accounting that are ripping apart the fabric of the world's economy. How can a security that has a high probability of full repayment be downgraded from AA to junk levels?
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Friday, September 19, 2008
US Taxpayer: A Giant Dumpster For Illiquid Assets / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
Paulson, Bernanke, and Congress are conspiring to make the US taxpayer the fall guy for financial stupidity by banks and brokers. Congress is now willing to ram through legislation at the last moment, even though Senate Majority Leader Reid Says "No One Knows What to Do" . Read full article... Read full article...
Friday, September 19, 2008
You Own Junk Bonds, Like it or Not / Interest-Rates / US Debt
By: Mike_Stathis
For many years now we've all seen the reckless use of taxpayer funds by Washington . This irresponsible and unaccountable waste of tax dollars has been particularly prominent during President Bush's tenure - from billions going to blow up bridges, roads and buildings in Iraq , only to rebuild them - to the Department of Homeland Security, which is no more than a joke. Meanwhile, America 's own infrastructure is in badly need of repair, with current estimates anywhere between $1.5 to $3 trillion and growing each day. Read full article... Read full article...
Friday, September 19, 2008
Time for Selective Buying of Mortgaged Backed Securities? / Interest-Rates / Credit Crisis 2008
By: Andrew_Butter
What's the difference between a TV rating and a bond rating? Answer: The TV rating is audited.
Putting the incompetence of the rating industry in USA and Nadeem Walayat's expression Tulip Backed Securities to one side, my granny always used to say, "Where there's Muck there's Brass"
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Wednesday, September 17, 2008
Credit Freeze, 3 Month Treasury Yields Effectively Hit Zero, Gold Soars / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
A massive global rally in treasuries is underway and gold may be headed for its biggest one day advance in history as global systemic distrust sets in. Read full article... Read full article...
Wednesday, September 17, 2008
Federal Reserve Holds Interest Rates Defying Wall Street / Interest-Rates / US Interest Rates
By: Money_Morning
Martin Hutchinson writes: The U.S. central bank's Federal Open Market Committee (FOMC) yesterday (Tuesday) left the benchmark Federal Funds rate target at 2.0%, after many had expected the central bank policymaking committee to cut rates in the wake of the Lehman Brothers Holdings Inc. ( LEH ) collapse. Read full article... Read full article...
Monday, September 15, 2008
Pimco, Vanguard Are Biggest Bond Fund Losers in Lehman Collapse / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
It's payback time for betting on moral hazards as Pimco, Vanguard Are Biggest Bond Fund Losers in Lehman Collapse .Pimco Advisors LP, Vanguard Group Inc. and Franklin Advisers Inc. are among the investment companies that will face losses of at least $86 billion stemming from the collapse of Lehman Brothers Holdings Inc., the biggest bankruptcy in history.
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Monday, September 15, 2008
US Treasury Bonds Slide as Financial's Take Turns at Blowing Up / Interest-Rates / US Bonds
By: Levente_Mady
The US Treasury market seems to be running out of steam here in spite of supportive data from economic fundamentals. Canadian long term bonds have kept pace with the trend to lower yields in the US market and seem to be poised for a breather as well.
The cream of the financial crop is relentlessly taking turns at blowing up. Last week it was Fannie and Freddie – the largest mortgage companies in the world, this week it was Lehman Brothers - another one of the largest investment dealers on the planet, next week it looks like it could be AIG – not long ago the largest insurance company around – that might be on the bankruptcy block.
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Friday, September 12, 2008
FOMC US Interest Rate Meeting of September 16th / Interest-Rates / US Interest Rates
By: Joseph_Brusuelas
Nearly ten years ago the Federal Open Market Committee convened a special meeting to address the problems in U.S. financial markets regarding the failure at Long Term Capital Management. It is not without irony that one decade later the Fed and the U.S. Treasury are addressing an infinitely more complex problem with respect to Fannie Mae and Freddie Mac, while at the same time contemplating the potential failure of major investment and commercial banks. Read full article... Read full article...