Something major is happening here

Discussion in 'Trading' started by detective, Sep 20, 2007.

  1. The USD is getting pounded against all major currencies, the 10 and 30 year Treasury yields have bumped up significantly, causing mortgage rates to RISE. And oil is now almost $84/barrel!

    Heli Ben made a BIG MISTAKE. The market has spoken, the equity traders will finally wake up, the novacaine effect from the 50 bp shocker is wearing off and once they realize that mortgage rates are actually higher AFTER the 50 bp cut, people will wake up to the realities. It is not gonna be a pretty Q4. Current economic situation is the perfect model for stagflation.
  2. Would be quite funny to have a dollar crisis arise causing him to make an emergency rate increase!!
  3. Mvic


    Yes what is happening is that Foreign buyers increased their US$ holdings from $2.4 Trillion in 2002 to $7Trillion in 2007 and now they are getting shafted. Does the Fed really expect them to sit quietly by while their investments get eviscerated, at a minimum you would expect that at least until the $ stablizes they at least reduce their continued investment in US$ which alone is enough to raise long rates given the amopunt of paper we need to roll over just to fund current liabilities let alone future and growing liabilities. The action in the Yen today was very telling and the Saudis threatening to break their peg to the US$ is all just the beginning of the backlash.
  4. I like the LIBOR VS Treasury Yields debate going on. So the wallstreet cheer leaders now say look at the LIBOR rate it's falling. But when they wanted their rate cut they said look at the 90 treasury yields fed needs to ease.

    My short position in ZN is doing well.
  5. Foreigners are in effect financing American lifestyles as well as the American war buying up dollar denominated assets which is created by the printing presses. Foreigners have so far had faith in the dollar, but its slowly going away.

    Once they realize that the Fed is going to continue to crank the printing presses into overdrive until foreigners call their bluff, you will see a massive move down in the dollar which will shock the system, put oil into the triple digits and gold up to 900+.

    We are watching history before our eyes, this is a grand inflation experiment that Helicopter is putting into action, the consequences are going to be disastrous for dollar holders.