Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Friday, September 04, 2015
Meet QT; QE's Evil Twin / Interest-Rates / Quantitative Easing
By: Peter_Schiff
There is a growing sense across the financial spectrum that the world is about to turn some type of economic page. Unfortunately no one in the mainstream is too sure what the last chapter was about, and fewer still have any clue as to what the next chapter will bring. There is some agreement however, that the age of ever easing monetary policy in the U.S. will be ending at the same time that the Chinese economy (that had powered the commodity and emerging market booms) will be finally running out of gas. While I believe this theory gets both scenarios wrong (the Fed will not be tightening and China will not be falling off the economic map), there is a growing concern that the new chapter will introduce a new character into the economic drama. As introduced by researchers at Deutsche Bank, meet "Quantitative Tightening," the pesky, problematic, and much less disciplined kid brother of "Quantitative Easing." Now that QE is ready to move out...QT is prepared to take over.
Friday, September 04, 2015
Bill Gross: Jobs Report Means ‘Fifty-Fifty’ Chance of Fed Sept Interest Rate Move / Interest-Rates / US Interest Rates
By: Bloomberg
Bill Gross of Janus Capital spoke with Bloomberg's Tom Keene and Michael McKee on Bloomberg Radio and Television about today's jobs numbers, the markets and Fed policy.
When asked whether the Fed will raise rates on September 17th, Gross said: "I still think it’s 50/50 and China and global conditions are the dominant factor. Otherwise, I would have said, yes, I think Fischer and Yellen and maybe even Dudley their fingers are itching."
Thursday, September 03, 2015
ECB Preempts Fed Inaction, PBOC Action / Interest-Rates / ECB Interest Rates
By: Ashraf_Laidi
The ECB succeeded in weakening the euro and bund yields with an aggressive downgrade of 2015-2017 forecasts for GDP and CPI, while announcing an increase in the issue share limit of bonds included in QE purchases to 33% from 25%. The increased limit means the ECB can buy a higher share of an individual nation's bond issue, giving it more freedom of concentration in particular issues.
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Thursday, September 03, 2015
The Student Loan Crisis Is Mounting / Interest-Rates / Student Finances
By: Peter_Schiff
Addison Quale writes: "You need a college degree to succeed in America." This idea has become so commonplace that the right to higher education is now a core issue in most political platforms. What if a young person cannot afford a college degree? The "obvious" answer from politicians on both sides of the aisle is that the government should subsidize them. Very few are brave enough to ask the far more important question: "At what cost?"
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Tuesday, September 01, 2015
Forget Decoupling - The Fed will NOT Raise Interest Rates this Year / Interest-Rates / US Interest Rates
By: Ashraf_Laidi
USD under renewed pressure from a combination of renewed China data disappointment, weak US manufacturing ISM and lingering chatter of a September Fed hike. US stock futures began selling off 6 hours before the release of China's manufacturing PMI, which showed the first contraction in six months and the lowest figure in three years. The largely-weaker than expected manufacturing ISM (lowest in 27 months) was accompanied by broader weakness in all components.
Thursday, August 20, 2015
The Fed Talks And The Market Tanks. That’s Different / Interest-Rates / US Federal Reserve Bank
By: John_Rubino
Normally there’s a distinct pattern to the impact of Federal Reserve statements on the financial markets. The tone of equities trading in particular starts to improve as the moment of the announcement approaches; the words turn out to be blandly positive, full of promises of easy money and upbeat forecasts; and share prices soar for a day or two. It’s been thus for most of the past six years, leading large numbers of new investors and recently-minted analysts and traders to see the Fed as a modern version of Plato’s philosopher king, wielding absolute power to achieve perfect justice in the form of rising asset prices.
Thursday, August 20, 2015
Trumping the Federal Debt Without Playing the Default Card / Interest-Rates / US Debt
By: Ellen_Brown
In a post on "Sovereign Man" dated August 14th, Simon Black argued that Donald Trump may be the right man for the presidency:
Read full article... Read full article...[T]here's one thing that really sets him apart, that, in my opinion, makes him the most qualified person for the job:
Thursday, August 20, 2015
Another Day Younger and Deeper in Debt / Interest-Rates / US Debt
By: John_Mauldin
My friend Neil Howe, author of Generations, The Fourth Turning, and other books and president of Saeculum Research, joins us today in Outside the Box with a succinct, eye-opening essay on generational differences in debt levels and attitudes towards debt.
I often write about the problems that come with overindebtedness, but we’re usually talking about public debt, here in the US or abroad. But personal or household debt in America is nearly as massive as government debt, as this chart shows:
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Tuesday, August 18, 2015
How to Avoid Puerto Rico's Debt Crisis and Make Money on It / Interest-Rates / Global Debt Crisis 2015
By: ...
MoneyMorning.com Shah Gilani writes: Puerto Rico is desperately trying to reorganize its $72 billion debt, but it faces a unique hurdle…
You see, it's an unincorporated territory, not a state. It can't actually declare Chapter 9 bankruptcy.
Without those legal protections, the Caribbean island is clearly sunk.
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Tuesday, August 18, 2015
A Street Car Named U.S. Treasury Bonds / Interest-Rates / US Bonds
By: Michael_Pento
sIn the 1947 Tennessee Williams play "A Streetcar Named Desire" as she is being carted off to the mental institution Blanche Dubois utters these famous words ... "I have always depended on the kindness of strangers."
And like Ms. Dubois, the United States has also come to depend on the kindness of strangers to fund a massive $18.3 trillion in debt.
But that kindness the US Treasury has come to depend upon may be waning. Foreign holdings of U.S. Treasury securities fell in May for a second straight month. The Treasury Department reported total holdings were down 0.1% in May to $6.13 trillion. This comes after an even bigger 0.6% decline in April.
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Friday, August 14, 2015
Fed will Cut 'Transitory' in September / Interest-Rates / US Interest Rates
By: Ashraf_Laidi
A Russian saying goes "nothing is more permanent than temporary". At the Federal Reserve, "transitory" may mean "permanently", or could also mean "we have no clue". Oil has dropped by 57% since over the last 12 months but the +200 PhDs at the world's biggest central bank continue to describe lower energy prices as "transitory". At the June FOMC, the Fed made some progress and finally dropped its phrase from the FOMC statement that "energy prices have stabilized".
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Friday, August 14, 2015
Inside the Bank of England - Video / Interest-Rates / Central Banks
By: Anika_Walayat
Take a journey from a unique perspective into the very heart of Britain's financial system, it's central bank, the Bank of England.
Friday, August 14, 2015
Debt Deleveraging as a Biblical Plague / Interest-Rates / Global Debt Crisis 2015
By: Raul_I_Meijer
Eventful days in the middle of summer. Just as the Greek Pandora’s box appears to be closing for the holidays (but we know what happens once it’s open), and Europe’s ultra-slim remnants of democracy erode into the sunset, China moves in with a one-off but then super-cubed renminbi devaluation. And 100,000 divergent opinions get published, by experts, pundits and just about everyone else under the illusion they still know what is going on.
We’ve been watching from the sidelines for a few days, letting the first storm subside. But here’s what we think is happening. It helps to understand, and repeat, a few things:
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Thursday, August 13, 2015
China’s Doing Yellen’s Job and Creating a Trillion Dollar Profit Pivot / Interest-Rates / US Interest Rates
By: Money_Morning
Keith Fitz-Gerald writes: Despite what the markets seem to think and many news sources would have you believe, China’s move to devalue the yuan by 1.9% is not an act of desperation intended to prop up a failing economy. It’s not a surprise. And, it sure as heck is not the end of the financial universe as we know it.
Instead, it’s a brilliant move that singlehandedly changes the investing landscape and creates a fabulous new set of profits if you’ve got the guts and the smarts to make your move.
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Thursday, August 13, 2015
German-US Bond Yield Spread Breaks Out / Interest-Rates / International Bond Market
By: Ashraf_Laidi
Bond yields fell across the board since mid-June, but the more meaningful fact for currency traders remains yield differentials. For EURUSD watchers, the rate of decline in 10-year bund has been slower than its US counterpart, which led to a stabilisation in the German-US spread (not US-German) to the extent of breaking above an important 3 ½ year trendline.
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Wednesday, August 12, 2015
Junk Bonds - The Next Financial Disaster Starts Here / Interest-Rates / International Bond Market
By: Casey_Research
By Dan Steinhart
Individual investors take note…
Some of the world’s best money managers are betting on the biggest financial disaster since 2008.
You won’t hear about this from the mainstream media. Networks like NBC or CBS don’t have a clue… just like they didn’t have a clue the US housing market would collapse in 2007.
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Wednesday, August 12, 2015
10yr Treasury Notes / Interest-Rates / US Bonds
By: Ed_Carlson
TNX, the yield on the 10 year Treasury note, fell for the fourth week in a row with a loss of 1.36% to close at 21.75 on Friday after challenging the 30-dma earlier in the week. TNX remains in the 2015 trend channel and should find support at the lower boundary and 200-dma both which are near 21.34.
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Tuesday, August 11, 2015
Greenspan Warns Be Afraid of U.S. Bond Market Bubble / Interest-Rates / US Bonds
By: Bloomberg
Former Federal Reserve Chairman Alan Greenspan spoke with Bloomberg's Tom Keene about the U.S. economy, bond market and Fed policy.
On how afraid we should be of bubbles, Greenspan said: "Very much so. I think we have a pending bond market bubble. If we merely substitute the structure of equity prices and we have the price of bonds and instead of expected equity return we do have expected interest rate return. That price earnings ratio is an extraordinarily unstable position."
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Monday, August 10, 2015
U.S. Dollar QE Death Sentence, Us Treasury Bond Black Hole / Interest-Rates / US Bonds
By: Jim_Willie_CB
Rather than stimulus, the USFed's Quantitative Easing is a death sentence for the USDollar. It might provide an ongoing backdoor bailout opportunity for Wall Street banks, and even a window for China to switch from long dated to short dated USTreasurys, but QE is death sentence. It guarantees that the USDollar will be removed from the global premises and placed in the dustbin of history. Foreign banking systems are largely devoted to USTBonds as the foundation for their entire reserves system. The African type of hyper monetary inflation blessed as good and fine stimulus is a sentinel signal by the US Federal Reserve itself, given to the Eastern producing nations who save in the $billions. They will start a caravan to exit the USDollar in their banking systems. They have great challenges in doing so, and must follow a prescribed path. That path is the Chinese RMB as an intermediary device, a transition tool. The goal is the return of the Gold Trade Standard, which will assure the return to the Gold Currency Standard and the Gold Banking Standard. The absent solution to the chronic global financial crisis has been the refusal to put Gold at the apex. Instead, the big banks have become zombies, the economies have become sclerotic, the financial structure have been control rooms, the bond platforms have been fracturing, while the USGovt has relied upon bond fraud, gold thefts, the printing press, and predatory wars to defend the King Dollar regime. It is due for the funeral pyre.
Sunday, August 09, 2015
The Unseen Consequences of Zero-Interest-Rate Policy / Interest-Rates / US Interest Rates
By: MISES
Ronald-Peter Stöferle writes: In a dynamic economy, an action not only triggers just one effect, but always an entire series of different consequences. While the cause of the first effect is easily recognizable, the other effects often occur only later and no such recognition occurs. Frédéric Bastiat described this phenomenon in 1850 in his ground-breaking essay “What Is Seen and What is Not Seen”:
Read full article... Read full article...In the economic sphere, an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee them …