Exactly. The Fed is not create to help stock market to make new high every week. The purpose of the Fed is to create stability of the economy. The credit crunch is created by the financial firms, and they need to take responsibility to clean it up. If the Fed just give them what they want, there will be no order. They know whatever they do, someone will going to bail them out.
I have no idea what you are talking about. I claim all the FED should do today is go to a 100% neutral stance, where it makes clear, that if the credit woes intensify, it will act. How is that going to zero % ? It holds rates steady, and recognizes the problem and tells traders to go about their business and that the world is not comming to an end. nitro
Be my guest and sell SIFs on an ease then and see what happens to you. All markets oscillate on a schock. That it will be volatile is an understatement. nitro
I don't really see why you mention Fed rate and compare it to bond yields Fed rate is higher for quite a long time and it wasn't big concern till now and inverted curve is when short term bonds pay more than long term and it's not inverted now
Daily Treasury Yield Curve Rates Get e-mail updates when this information changes. -------------------------------------------------------------------------------- Historical Data This data is also available in XML format by clicking on the XML icon August 2007 Date 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr 08/01/07 5.05 4.89 4.96 4.82 4.56 4.53 4.60 4.66 4.76 4.99 4.90 08/02/07 5.02 4.89 4.95 4.83 4.59 4.57 4.62 4.68 4.77 5.00 4.91 08/03/07 4.94 4.85 4.91 4.76 4.46 4.45 4.52 4.59 4.71 4.96 4.87 08/06/07 4.92 4.88 4.92 4.76 4.46 4.45 4.52 4.60 4.72 4.98 4.89 08/07/07 5.05 4.94 4.98 4.84 4.56 4.55 4.60 4.66 4.77 5.01 4.92 http://www.ustreas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml **************************** I call this an inverted yield curve.
What I see 2 year pay less than 10 years and 10 years pay less than 30 years so yield is not inverted
The Lehman Treasury Index is a 5 year duration. 2's are inverted to 5's. The world cares little about the long end of the curve. 90% of the long bonds in circulation are stripped into zero's.