Long term yeilds?

Discussion in 'Economics' started by The Kin, Jul 17, 2005.

  1. I find it intresting that mortgage rates are still falling


    1 year ago: 5.11%
    3 months ago: 5.01%
    now: 4.85%


    1 year ago: 5.70%
    3 months ago: 5.41%
    now: 5.27%

    Fed Reserve

    1 year ago: 1.25%
    3 months ago: 2.75%
    now: 3.25%

    Short term rates go up, long term rates go down. Maybe future fed rate increases will be unable to pop the housing bubble and maybe even make rates more affordable?
  3. Is deflation really a bad thing?

    For one, it's not inflation. Two, it can be controlled by simply printing more money. Unless my concept of deflation is flawed.
  4. Maybe ask the Japanese? Or is their economic malaise an anomaly? Can anyone here explain the concept of a liquidity sinkhole in laymen's terms?
  5. empee


    what people havent considered is that deflation is proportional to inflation. Meaning, the solution to deflation was always printing money, but what if that just accelerated deflation?

    Usually things play out NOT the way people were expecting them, and I for one would welcome deflationary spiral to finally reward those who actually saved money instead of supply-side consumed to oblivion.
  6. Say the US economy experienced massive deflation. You're telling me that if the US govt were to cut taxes completly and passed a 4 trillion budget by printing 200 billion $20 bills that would not immdiatly stop deflation and also cause massive inflation?
  7. Absolutely agree (that savers shouldn't get screwed), BUT then WHY, OH WHY, would the powers that be in US have US households increase their debts by 55% since 2000 to over $10 TRILLION, by pursuing a negative real interest rates policy for so long?
  8. flat yield curve usually means recession, or as many think this time, deflation.

    I think its due to Asian central banks buying US debt no matter what. Depresses their currencies, plus, where else are they going to put their massive dollar flows.

    China is the big wild card this time as never before. This yield curve may leave everyone looking silly.

  9. LoL

    Greenspan says the economy is good and intrest rates are going up.

    Bonds surge on the news.


    Greenscam has lost his power. Inverted yield curve here we come!

    Forget the hosuing market, it's the bond market which is the real bubble.
  10. They are all part of the world wide asset bubble, be it equity, bond or real estate.

    #10     Jul 20, 2005