Fed Meeting on Monday, April 5th at 11:30am

Discussion in 'Wall St. News' started by sttrader, Apr 1, 2010.

  1. crap, you are right! i totally fell for it :mad:
     
    #11     Apr 2, 2010
  2. schizo

    schizo

    I'm still scratching my head to understand why they couldn't settle their crap, whatever it is, on their next FOMC meeting. What's the need for an "expedited" love fest and exactly what the hell are they planning to expedite? I doubt Bernanke will announce a "surprise! surprise!" rate change on Monday. If not, then what?
     
    #12     Apr 2, 2010
  3. There's no mystery the market's gonna tank soon. The FED is cool things down and rally it again in the fall.
     
    #13     Apr 2, 2010
  4. IIRC last time they raised discount was Feb 18th, announced right after RTH and ES dropped 8 pts; shrugged it off and rallied back overnight (maybe asia/eu data helped, dont remember)
     
    #14     Apr 2, 2010
  5. I just pulled the April 2nd yield curve from the federal reserve website:

    April 2010
    Date 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr
    04/01/10 0.16 0.16 0.24 0.42 1.05 1.63 2.59 3.32 3.89 4.58 4.74
    04/02/10 0.15 0.16 0.26 0.46 1.11 1.70 2.67 3.40 3.96 4.65 4.81


    Here's the link:

    http://www.ustreas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml

    The yield curve was already ridiculous, but this new steepening feels like coming off the rails. Interestingly, the 1 month yield fell by 0.01. If they were going to be raising rates next week, I wouldn't have expected the short rates here to fall.

    As confusing as all this is, it feels like a critical market juncture to me. I bet Soro's back is killing him, mine is.
     
    #15     Apr 3, 2010
  6. Firstly, this is not a Federal Reserve website. It's a US Treasury Dept website.

    Secondly, what's so ridiculous about this yield curve?

    Thirdly, as I have mentioned in another thread, it's extremely improbable that the meeting on Monday has anything to do with the Fed doing anything with the funds rate. There's a whole variety of reasons for why that's the case.
     
    #16     Apr 3, 2010
  7. 1: Thanks for the website correction.

    2: I'm not going to get into an argument with you on here, but I will cite references so you can think for yourself. Buttonwood dedicated his column in this week's Economist magazine to the dangerously steep yield curve titled "Dangerous Curve". Here's a snippet:

    And here's the link:

    http://www.economist.com/business-finance/displaystory.cfm?story_id=15819178

    I have yield curve data for US treasuries back to 1962 and let me assure you, we are in uncharted territory. The spread between the 1 year and the 10 year just made a historical high, and short yields are at historic lows. I've attached a chart of the spread since 1962.
     
    #17     Apr 3, 2010
  8. Agreed, we don't have to argue about this, as it is, really, all subjective. Moreover, I assure you I don't need to look at references, such as journalists' articles, to understand exactly what sort of territory we're in. I stare at this sh1te every day.

    I just want to draw your attention to the fact that, contrary to what many Americans believe, the US is not the only country in the world with functioning govt bond markets. Have you ever looked at the shape of the gilt (UK guvvies) yield curve or the Aussie one?

    Most of these things, over which many commentators get their knickers in a twist, have probably happened at one time or another and there's nothing particularly "uncharted" about them. This includes things like negative 10y spreads, high debt/GDP, auctions that don't go too well, etc.

    In the end, it's all up to you and how bad you think things are. If you think the game that the CBs arnd the world are playing is going to work out, everything is gonna be just fine. Otherwise, we're all screwed, but what else is new?
     
    #18     Apr 3, 2010
  9. Here's a better picture of what I was trying to describe: spread between 1 yr and 10 yr as a % of 10 yr yield.
     
    #19     Apr 3, 2010
  10. is anybody on ET serving coffee and doughnuts to the Governors? how do they look: anxious/relaxed?
    Thanks
     
    #20     Apr 5, 2010