Whither US Treasuries?

Discussion in 'Economics' started by drcha, Aug 12, 2019.

  1. drcha


    Bought my 30-yr bonds back a couple of months ago. Looks like I might need a new saddle to settle in for a long ride.

    Do people think rates will really go negative? It's hard to believe.
  2. tommcginnis


    This is highly suggestive of a recession on the horizon...
    (Though not, as has become popular, "in the next year". Note the mid-90s -- a very similar environment in many ways.)


    If you bought with a 2.6% yield? Yeahhhhh, it might be awhile. But too, these days? "We're one tweet away from..._____whatever______." So, Safe Paper might be a nice place to park some cash til the indexes go south. Truly "Dunno" though....


    ((These graphics from: https://www.cnbc.com/2019/08/13/us-...level-since-2007-amid-risk-off-sentiment.html which came out at 4amET.))
    Last edited: Aug 13, 2019
  3. bone

    bone ET Sponsor

    Ouch Dude. :banghead:

    The FED will never officially issue a negative coupon instrument but they will trade negative in the secondary market.

    Japan and now the EU have had negative rates for protracted periods of time (the JGB for many years).

    And Draghi isn’t done - he’s signaled to EU Banks that rates will become more negative. The ECB is lowering rates to weaken the € against the $ as a trade weapon. And it’s working.

    Powell is just getting started - he’s way behind and he’s finally admitted as much in a cryptic Fed-speak manner.

    US TY yield: 1.688%
    Bund yield: -0.509%.
    JGB yields -0.194%.
    Last edited: Aug 13, 2019