Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Wednesday, September 03, 2014
The U.S. Government Bond Market Bubble / Interest-Rates / US Bonds
By: Moses_Kim
What follows will read like an indictment on our entire economic system. But underlying my (relatively mild) harangue is an observation that people are ignoring the most obvious bubble out there; that is, the bubble in U.S. government bonds. The following is my attempt to figure out why.
Tuesday, September 02, 2014
The Fed's Ice Bucket Challenge / Interest-Rates / US Federal Reserve Bank
By: Michael_Pento
Unless you have been living under a rock for the past month, you have more than likely heard of the ALS Ice bucket challenge. But, just in case you have been living under that rock--the challenge dares nominated participants to be filmed having a bucket of ice water poured on their heads and challenging others to do the same. The stipulation is that the nominated people have 24 hours to comply, or forfeit by way of a charitable donation to ALS. It is an ingenious marketing campaign that has thankfully raised awareness and millions of dollars for ALS.
Friday, August 29, 2014
The Fed Meeting at Jackson Hole Exposed Yellen’s Greatest Weakness / Interest-Rates / US Federal Reserve Bank
By: Money_Morning
James Rickards writes: At the recent central banker conclave in Jackson Hole, Wyoming, the two most powerful central bankers in the world, Janet Yellen, chair of the U.S. Federal Reserve, and Mario Draghi, president of the European Central Bank (ECB), gave back-to-back addresses on the same subject.
It was like a controlled experiment in the attitudes and capabilities of the two leading financial powers in the world.
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Thursday, August 28, 2014
European Bond Market: Bubble of all Bubbles! / Interest-Rates / Eurozone Debt Crisis
By: EconMatters
European Bond Rush
Right now investors in European Bonds are running over each other all in an effort to front run what the Big Banks have been begging the ECB to begin a bond buying program similar to the United States’ QE bond buying program.
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Monday, August 25, 2014
Why Global Bond Yields Are Tumbling / Interest-Rates / International Bond Market
By: Michael_Pento
Market pundits appear to be mostly dumbfounded as global bond yields continue to set record lows. For some examples; the 10 year German bund fell below 1%., the Italian 10 year note has dropped below 2.60%, Spanish bonds fell to 2.40 % and Japan is offering a shocking one half of one percent to borrow funds for ten years. Even Greece, whose bonds were on ECB life support just two years ago, has a 10 year note yielding below 6%. Worldwide bond yields are at all-time lows, leaving market commentators scrambling to come up with a creative array of explanations for this phenomenon. Tensions in Ukraine and escalating violence in the Middle East are some favorites. But at least in Europe and Japan, most are willing to attribute record-low bond yields to the real cause…that is no growth and deflation.
Monday, August 25, 2014
The Fed Will Raise U.S. Interest Rates in March 2015 / Interest-Rates / US Interest Rates
By: EconMatters
March or June?
The big question for financial markets is whether the Fed will raise rates in March or June, it used to be Whether it would be June or September of 2015, and I think as the data gets better in the second half of the year, and QE ends in October, the timeline could be moved up even further, say January of 2015 for the first rate hike.
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Saturday, August 23, 2014
U.S. Interest Rates - Is It Time To Ignore The Fed? / Interest-Rates / US Interest Rates
By: Sy_Harding
All eyes are on the Fed. When will it begin to raise interest rates? Some say next summer. Others think sooner, in the first quarter of next year. A few Fed governors insist that will be too late, that the Fed needs to act before year-end.
Analysts hoped some hints could be gleaned by reading between the lines of Fed Chair Yellen’s speech in Jackson Hole on Friday morning, or perhaps from nuances in her tone of voice.
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Saturday, August 23, 2014
U.S. Interest Rate Rise to Occur Mid-2015 According to Fed's Williams / Interest-Rates / US Interest Rates
By: Bloomberg
Bloomberg Television's economics editor Michael McKee spoke with San Francisco Federal Reserve President John Williams in Jackson Hole, WY today, who said that very accommodative policy is what's needed now.
Williams said, "...it's clear unemployment is too high and inflation is still too low and it calls for a very strong accommodative policy, and I think that's been a big factor helping our economy recover. And I wouldn't want to see us tightening the policy until we've made further progress in that some time next year."
Friday, August 22, 2014
Negative Real Interest Rates Show Yield Trade in Bubble Territory / Interest-Rates / International Bond Market
By: EconMatters
No Financial Crisis
This is one of my main criticisms of central bank policy, especially the last three years when there was no financial crisis but all the central banks continued to keep interest rates at recession era levels which has incentivized inappropriate uses of capital allocation, and this money being used for yield arbitrage plays would be more beneficial to sustainable growth projects and overall growth in the economy if interest rates were normalized.
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Friday, August 22, 2014
U.S. Interest Rates Can Rise States Fed President / Interest-Rates / US Interest Rates
By: Bloomberg
In an interview with Bloomberg's Michael McKee, Federal Reserve Bank of Kansas City/MO President Esther George said she sees 'significant progress' in the labor market in 2014, "We have seen significant progress in the labor market over the last three years, and particularly this year," gains have been "broad-based, and that's a very encouraging sign."
George told McKee that "Inflation looks to be stable," and "there's every reason to think we should start talking about normalization."
The Kansas City Federal Reserve President also said that we must return the balance sheet to the smallest amount we can and noted that the very large balance sheet has "complicated the process of monetary policy."
Thursday, August 21, 2014
The Bond Market is taking Advantage of Janet Yellen`s Dovishness / Interest-Rates / US Bonds
By: EconMatters
Push the Limits
It has been a common theme in financial markets to push the limits on any possible edge, so if there are restrictions on banks and financial institutions use of leverage, lobby for change, or if activity falls under a certain governmental regulation, alter the activity so that it is classified under a different interpretation so that previous limits can be exceeded.
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Wednesday, August 20, 2014
Ukraine Interest Rates Soars to 17.5% As External Debt Cannot be Repaid / Interest-Rates / Ukraine Civil War
By: Mike_Shedlock
It's crystal clear Ukraine has no interest in a ceasefire under any terms. Instead it demands rebels lay down weapons and for Russia to stop intervention. In short, Ukraine demands surrender.
Thus death and destruction will continue, possibly long after Ukraine takes over Luhansk and Donetsk (or rather what's left of Luhansk and Donetsk).
Wednesday, August 20, 2014
Rising Interest Rates and The End of Stimuland / Interest-Rates / Quantitative Easing
By: Raul_I_Meijer
It’s Jackson Hole week, and we’re going to hear a lot of fairy tales and otherwise invented-from-scratch material. Since it may not always be easy to distinguish between pure mud and actual information, let’s destroy a few fantasy piñatas right here and now. So when Yellen and Draghi speak on Friday, you’ll be able to tell a few things apart. It’ll be hard enough, the speech writers and spin doctors won’t get much sleep this week.
Monday, August 18, 2014
Europe Economy Is Tanking, QE Is Coming / Interest-Rates / Quantitative Easing
By: Anonymous
Last year the world kind of forgot about Europe. After ECB head Mario Draghi vowed to “do whatever it takes” to get the Continent growing, the markets calmed down, money got cheap and plentiful and functionally-bankrupt countries like Greece, Italy and Spain stopped making scary headlines. To the casual observer it began to look like the euro project might actually succeed.
Sunday, August 17, 2014
A New Interest Rates Record Is Set... And It Is Foreboding / Interest-Rates / ECB Interest Rates
By: DailyWealth
Dr. Steve Sjuggerud writes: A new record was set in Germany yesterday...
The interest rate on a 10-year government bond in Germany fell below 1%.
This number is shocking... Interest rates have never been this low in German history.
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Sunday, August 17, 2014
Variable Interest Rates World, Japan's Home Buyers Up In ARMS / Interest-Rates / Japanese Interest Rates
By: John_Rubino
Everyone knows that Japan deeply is in debt and one way or another is going to suffer for it. But for those who thought the story couldn't get any worse, well, the creativity of the financial repressors never ceases to amaze.
It turns out that, in addition to a government that borrows way too much money at unnaturally low rates -- guaranteeing that rates can never be allowed to rise because the cost of paying even 2% interest would bankrupt the country -- Japan's homeowners have discovered the joys of adjustable-rate mortgages:
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Sunday, August 17, 2014
The Federal Reserve in Denial Mode - Bond Market Explained / Interest-Rates / US Bonds
By: EconMatters
Business Media Rock Star
On Thursday Mohamed A. El-Erian was on CNBC`s Halftime Report and he said something that a lot of people have been saying regarding the bond market, and it needs to be cleared up, because the amount of poor understanding regarding the bond market by people who make their living, i.e., are in the financial market business is astounding. It is even more mind blowing given that Mohamed A. El-Erian actually worked at a Bond Firm in PIMCO, and helped manage Harvard` s endowment in the past.
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Friday, August 15, 2014
Bonds Persist in Their Warning About the U.S. Economy / Interest-Rates / US Bonds
By: Sy_Harding
Bonds do not like economic strength, but love economic weakness.
It makes sense. In a strong economy there is upward pressure on interest rates, and therefore on bond yields. When bond yields go up, their prices go down.
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Friday, August 15, 2014
Cry for Argentina: Fiscal Mismanagement or Pillage? / Interest-Rates / Global Debt Crisis 2014
By: Ellen_Brown
Argentina has now taken the U.S. to The Hague for blocking the country’s 2005 settlement with the bulk of its creditors. The issue underscores the need for an international mechanism for nations to go bankrupt. Better yet would be a sustainable global monetary scheme that avoids the need for sovereign bankruptcy.
Thursday, August 14, 2014
Government Spending and Negative Interest Rates / Interest-Rates / ECB Interest Rates
By: MISES
Dickson Buchanan writes: In June, the European Central Bank (ECB) made a historic and downright diabolical announcement. They decided to inaugurate negative interest rates for overnight deposits. Here are the details from the official transcript:
Read full article... Read full article...The rate on the deposit facility was lowered by 10 basis points to -0.10 percent. These changes will come into effect on 11 June 2014. The negative rate will also apply to reserve holdings in excess of the minimum reserve requirements and certain other deposits held with the Eurosystem.