No confidence in U.S. and British debt

Discussion in 'Economics' started by wilburbear, Mar 29, 2009.

  1. This thread is all Bull S.

    If there was no confidence in US Debt, you would see US Treasury Bonds' yielding %20 instead of %0.5 like it is now.

    Get your facts straight before you post anything.
  2. clacy


    True. I can't say I have a lot of confidence in US Debt personally, but obviously there are plenty that do. 5 years from now, it may be a completely different game however.
  3. Assuming deficit projections by the Congressional Budget Office for the 2009 and 2010 fiscal years are right, and adding the cost of the stimulus plan, the bank rescue plan and borrowing costs, public debt would rise from 41 percent of G.D.P. in September 2008 to about 70 percent of G.D.P. three years later. That is roughly in line with Hungary’s December 2008 ratio.

    Treasury Yields absolutely inacceptable. Where is the risk premium associated with the above scenario ? :confused:
  4. What do you mean Treasury Yields are absolutely inacceptable? If the risk premium was high, you would see interest rates going up.

    If the interest rates are extremely low, that means the risk premium is extremely low.

    Simple as that.

    but if you are saying market is pricing these securities wrong, then that is a different story. How can the thousands of investors all around the world making the same mistake?
  5. Government debt in Japan is 180% of GDP. JGBs still yield what like 2.0%? :cool:
  6. In Geithner's testimony, a Congressman just said the U.S. is in danger of losing its AAA rating.

    Moodys threatened to yank the U.K.'s AAA rating just this morning.

    No confidence.

    These are turbulent times.
  7. the game is between resource holders and money printers...

    the reason yields are so low is that money can be continously printed to buy up supply to protect the inventory of debt already accumulated, mainly by our asian counter parts.

    that pool of money can take prices to wash out any speculative sellers. Ultimately what it does is, its a form of theft from resource holders.. they are being payed in garbage for resources that have some value.

    To fight this the resource holders have to refunnel the money into hard assets in the countries the money is being printed in. This fuels inflationary pressures of staggering proportions. Its a form of inflationary arbitrage..
  8. sccz97


    what ... the same investors who bought into the structured products market? surely you jest
    #10     May 21, 2009