Bond rally nearing an end?

So far, they haven't expressed any specific concern about the current run-up in oil prices and if I remember well, they haven't during the previous peaks either. Instead, they pay close attention to economic variables causing oil prices to go up and the extent to which higher crude prices are passed through to the consumer.

 

Yes understood, but cRUDE is in a bull market, and so are commodity prices, and gold. And, it's not going away any time soon.

So if they want to but on the blinkers (horses wear them to keep them from looking around during a race), and look straight ahead, they should look at the charts of Gold, cRUDE and the CRB straight away.

New Chairman, new honeymoon, new excusable errors?
Hope not!

 

I do not see how the fed can began to cut rates or go on a long pause anytime soon. Look at these booming commodity prices, the fed knows that if they appear too dovish while gold is at 620 and crude is at 72 the dollar will go into a death spiral along with bonds, especially at the long end. The fed needs to break the back of the commodity speculaters before they start cutting. If in the next month crude hits 80 and gold start pushing towards 700 the fed will have to begin sounding hawkish again or risking losing control. Just my .02 cents.

 

A good two cents worth too ... agree!

 

is that black or red?

 

Their information and their policy are major inputs to market sentiment and in that regard (and in many other aspects) they have a huge edge, which is fine because markets rely on them to make good decisions and to be credible. I oil tops tomorrow or after tomorrow (which is very likely to happen, by the way) and then drops $5 dollars or more over the following few days, they will end up being the ones who were right for not having changed their rethoric.

Otherwise, they will have missed an opportunity to send hawkish signals at a time the market was ready for it. We'll see.

 

Haven't had rye in a long time but scotch or bourbon... that's a different story.

 

Sure a $5 drop is possible, it just rose $11 nonstop. But it would only bounce back after that, as this uptrend is not nearly close a top yet.

 

Yea, you're right, $5 wouldn't be significant. But if we would drop by whatever amount and stay below $68-70 for a while...