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Epic Bond Rout Leads To Biggest Weekly Percentage Surge In 5 Year Yield In History

Tyler Durden's picture


As the table below demonstrates, the bond vigilantes are now eviscerating the belly of the US Treasury curve: the weekly percentage move higher in the 5 Year yield is now the largest...Ever. For those wondering if PIIGS should be renamed to PIIS following the brief rescue of G, perhaps it is time to officially rename it PIISA.

The chart below is an archive picture of what one day will be seen as officially ushering in QE 3. As for the naive follow on moves in the equities, it is merely a risk transfer.

As for the statistical evidence, courtesy of John Lohman, it speaks for itself. This week's move wider is the biggest percentage move ever.


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Fri, 07/01/2011 - 12:50 | 1419306 hedgeless_horseman
hedgeless_horseman's picture

Ever, bitchezzz!!!

Fri, 07/01/2011 - 13:52 | 1419553 jswede
jswede's picture

seriously ZH ?

you don't measure bond moves in yield.  it was a 1.83% sell-off in price.

wow, what a rout.

Sat, 07/02/2011 - 05:24 | 1421024 XPolemic
XPolemic's picture

You do realize that 45 bips over 5 years is 1.24% right?

Or were you joking?


Fri, 07/01/2011 - 14:23 | 1419645 Panafrican Funk...
Panafrican Funktron Robot's picture

2 year's been pretty fuggalicious as well.

Fri, 07/01/2011 - 12:48 | 1419307 JimBobOMG
JimBobOMG's picture

Cash for gold?

Fri, 07/01/2011 - 12:49 | 1419308 alexdg
alexdg's picture

Is Bernankes' oatmeal getting cold again?

Fri, 07/01/2011 - 13:02 | 1419378 camoes
camoes's picture

hahah +1

Fri, 07/01/2011 - 13:13 | 1419426 Xibalba
Xibalba's picture

Obummer's tryin to win friends on Wall St.  Donations bitchez!

Fri, 07/01/2011 - 12:50 | 1419319 PaperBear
PaperBear's picture

Does this surprise any ZH reader ?

I think not.

Fri, 07/01/2011 - 12:55 | 1419327 slaughterer
slaughterer's picture

We knew this, but it is nice to see it documented for the public.

Fri, 07/01/2011 - 14:21 | 1419633 kito
kito's picture

surprises me. china has come out and stated the will prop up europe and lend to any struggling countries. surely they wouldn't do it to the detriment of the u.s.

Fri, 07/01/2011 - 14:34 | 1419695 SheepDog-One
SheepDog-One's picture


Fri, 07/01/2011 - 21:27 | 1420632 phyuckyiu
phyuckyiu's picture

Paging sheep dog, paging sheep dog, lost sheep on aisle 13, need assistance STAT. Rut Roh.

Sat, 07/02/2011 - 02:46 | 1420869 phyuckyiu
phyuckyiu's picture

Surely China isn't upset about us blowing up/locking them out of 10 billion plus in investments in Libya they had ongoing. Right?

Fri, 07/01/2011 - 12:51 | 1419324 Jack Mehoff
Jack Mehoff's picture

Just getting started?

Fri, 07/01/2011 - 12:55 | 1419328 wombats
wombats's picture

So what does this indicate?  Does it mean that interest rates at banks will go up?  Does it indicate that PM or other commodity prices should go up or down?

Fri, 07/01/2011 - 12:58 | 1419338 1100-TACTICAL-12
1100-TACTICAL-12's picture

the Empire continues to crumble..

Fri, 07/01/2011 - 13:08 | 1419388 lawrence1
lawrence1's picture

It means BPGSFAYC .... buy as much physical gold and silver as you can as fast as you can while its still available at these relatively low prices considering the tsunami of paper flooding the world.


Fri, 07/01/2011 - 13:45 | 1419513 Stax Edwards
Stax Edwards's picture

It indicates that when the money spigot is turned off, interest rates rise quickly.  The banksters doth protest, turn the printers back on.

Fri, 07/01/2011 - 13:51 | 1419536 Dr. No
Dr. No's picture

Since only the biggest banks in the US control the spigot and since the spigot has been turned down, the banksters you indicate who are protesting, must be banksters outside the circle of trust.  The fat cats control the spigot.  Everyone else is on their own.

Fri, 07/01/2011 - 12:56 | 1419329 Cassandra Syndrome
Cassandra Syndrome's picture

QE can never end

Fri, 07/01/2011 - 12:53 | 1419334 youngman
youngman's picture

we all knew this...but what we don´t know is how much??? its 29.71% this week...but will it be 297.1% in one month????? That my boys is what makes me drink.....and cry as I watch gold and silver getting hit hard...

Fri, 07/01/2011 - 12:54 | 1419340 PaperBear
PaperBear's picture

Will we see the yield at 10 in short order then QE-steriods ?

Fri, 07/01/2011 - 12:58 | 1419341 slaughterer
slaughterer's picture

"As for the naive follow on moves in the equities, it is merely a risk transfer."

A "risk transfer" that leads to what, exactly?  Please, go a little further...

Fri, 07/01/2011 - 13:53 | 1419541 Bananamerican
Bananamerican's picture

hey, don't junk the man for asking questions....

anyone buying equities is a soon to be shorn sheep.

risk transfer=bag holder

Fri, 07/01/2011 - 12:54 | 1419342 Lone Mad Minute...
Lone Mad Minute Medic's picture

Why isn't TBT surging? Why are the PM's down? We're being bamboooziled! Where is the deer in the headlights? Because that is what is happening to us

Fri, 07/01/2011 - 13:10 | 1419408 lawrence1
lawrence1's picture

You expect rationality in phony markets?  Phony PM paper prices are down, meaning you have yet another chance to exchange failing fait for real money.  Get out of all paper, stop trading, starve the beast and, of course, buy as much PM as you can as fast as you can.

Fri, 07/01/2011 - 12:59 | 1419344 nicktd
nicktd's picture

Guess china had enough

Fri, 07/01/2011 - 12:55 | 1419348 ssp2s
ssp2s's picture

No problem.  The government's exploding cost of servicing its debt is just offset by all the capital gains taxes from everyone cashing in equities.

Algos DO pay taxes don't they?

Fri, 07/01/2011 - 13:36 | 1419501 Cthonic
Cthonic's picture

Algos DO pay taxes don't they?

On equity capital gains? Not if they are foreign nationals.

Fri, 07/01/2011 - 13:54 | 1419522 firefighter302
firefighter302's picture

ssp2s, you just gave me a "light bulb over head, suddenly illuminating" moment.



Fri, 07/01/2011 - 12:56 | 1419350 PaperBear
PaperBear's picture

Meanwhile paper silver price slides to $33.37/oz.

Fri, 07/01/2011 - 13:29 | 1419477 topcallingtroll
topcallingtroll's picture

waiting for the 200 dma for a quick trade.

Fri, 07/01/2011 - 12:59 | 1419354 Boston
Boston's picture

Oversold, big-time.  Buy it.  

In a few weeks, reality will set in---QE and fiscal austerity will soon begin.  Breakevens will collapse, and so will yields.

It happened in 2010 (remember, yields didn't collapse until about a month after QE1 ended).  The same thing will happen in 2011.

Fri, 07/01/2011 - 13:06 | 1419371 ghostfaceinvestah
ghostfaceinvestah's picture


Fri, 07/01/2011 - 13:07 | 1419383 ssp2s
ssp2s's picture

It happened in 2008, and surging yields quickly choked the economy.

Well, by "quickly", a couple of months later.

Fri, 07/01/2011 - 14:38 | 1419703 Chump
Chump's picture

I thought the whole point of QE was to keep austerity at bay...How/why would both happen concurrently?

Fri, 07/01/2011 - 13:03 | 1419361 mayhem_korner
mayhem_korner's picture

Anyone else hear John Williams' Jaws score in the background?



Fri, 07/01/2011 - 14:26 | 1419650 Temporalist
Temporalist's picture

I hear this John Williams:


According to John Williams of Shadow Government Statistics, if the U.S. government used GAAP accounting principles the "real" U.S. government budget deficit each year would be somewhere in the neighborhood of 5 trillion dollars.  Williams believes that the U.S. government is essentially bankrupt and that our current system is not anywhere close to sustainable....

Generally, you'll find that the accounting for unfunded liabilities for Social Security, Medicare and other programs on a net-present-value (NPV) basis indicates total federal debt and obligations of about $75 trillion. That's 15 times the gross domestic product (GDP). The debt and obligations are increasing at a pace of about $5 trillion a year, which is neither sustainable nor containable. If the U.S. was a corporation on a parallel basis, it would be headed into bankruptcy rather quickly."




"John Williams at still runs the numbers the way they were in those bygone days. Let’s recalculate…

22.3% unemployment + 11.2% consumer price index = 33.5% misery index

That compares to a peak misery index of 22.0% in June 1980."

Fri, 07/01/2011 - 13:04 | 1419364 n00b tube
n00b tube's picture

Risk transfer out of bonds, into equities?

Fri, 07/01/2011 - 13:05 | 1419367 Misean
Misean's picture

I guess THIS is what Bernutty meant by ending inflation in 15 minutes...

Fri, 07/01/2011 - 13:10 | 1419396 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Geithner's replacement is going to have to deal with a sh*tstorm of debt obligations.

Fri, 07/01/2011 - 13:14 | 1419433 Misean
Misean's picture

It's baked in. Playing brinksmanship in Warshington with the "debt ceiling" for a few more weeks while they do some maintenance work on the printer arrays. QE3 rolls out shortly after an "agreement" is reached.

The chaos caused by all of this will amplify the inflationary impacts of printing as it becomes impossible for producers of real stuff to plan production with any significant lead time.

Fri, 07/01/2011 - 13:54 | 1419561 Bananamerican
Bananamerican's picture

+ that

Fri, 07/01/2011 - 13:23 | 1419457 narapoiddyslexia
narapoiddyslexia's picture

Why does anyone think Geithner is leaving? He's running down the ratlines, folks, ahead of the pack.

Fri, 07/01/2011 - 14:03 | 1419587 11b40
11b40's picture

He is not going anywhere.  Just another in a long line of rumors, with many more to come, I'm sure.

No way Obummer puts up a new T.Sec. for Senate confirmation between now and the election.  Period, end of story.  Timmy could be caught naked in bed with 2 sheep and doberman & would still stay on through 2012.

Fri, 07/01/2011 - 14:31 | 1419671 narapoiddyslexia
narapoiddyslexia's picture

No doubt the sheep and Doberman would recant after it was revealed they'd rec'd $100k each from a drug dealer.

Fri, 07/01/2011 - 20:47 | 1420597 pgarner
pgarner's picture


Fri, 07/01/2011 - 14:30 | 1419684 Richard Chesler
Richard Chesler's picture

He has direct orders from Goldman NOT to speak to hotel maids.

Fri, 07/01/2011 - 17:49 | 1420296 Kayman
Kayman's picture

Do you actually think there are a couple of sheep or a Doberman that would stoop so low ?

Fri, 07/01/2011 - 13:05 | 1419368 Lone Mad Minute...
Lone Mad Minute Medic's picture

If we want this market to go down, then we all have to get in now. Don't you see, that's the only way this is gonna work. We need to give the bankers a good deal when they come to rape us. Everybody! take your clothes off too and tossed them into the ring.

Fri, 07/01/2011 - 13:02 | 1419370 American Sucker
American Sucker's picture

I thought the US was at its debt limit.  How are Treasuries still being issued?

Fri, 07/01/2011 - 13:16 | 1419440 Misean
Misean's picture

Looting the Feral slugs luxurious pension plans by issuing IOU's. Those coffers will be refilled when the loot limit is increased.

Fri, 07/01/2011 - 13:21 | 1419452 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

By looting public pension funds.

Treasury Continues To Dip Into Retirement Accounts, Prepares To "Take Out" $66 Billion Chunk To Make Room For New Bond Issuance:


Fri, 07/01/2011 - 13:35 | 1419487 FlyPaper
FlyPaper's picture

Old treasurys mature all the time; if they are replaced, the total debt outstanding doesn't go up...  

Fri, 07/01/2011 - 13:43 | 1419516 American Sucker
American Sucker's picture

Thanks, much appreciated.

Fri, 07/01/2011 - 13:43 | 1419519 American Sucker
American Sucker's picture

Thanks, much appreciated.

Fri, 07/01/2011 - 13:47 | 1419520 Cthonic
Cthonic's picture

Rollover, until you can't...

Fri, 07/01/2011 - 16:09 | 1420030 oldman
oldman's picture

"---------full faith and credit of----"

But I must admit I had no idea about the 14th amendment being the basis for 'general obligation' and 'full faith and credit'.

I wonder how the Supreme Couirt will rule?

(just joking)

Fri, 07/01/2011 - 13:06 | 1419375 Frank N. Beans
Frank N. Beans's picture

what the f is going on???   i'm getting killed.  Vix back down to zero?

Fri, 07/01/2011 - 13:57 | 1419569 Cthonic
Cthonic's picture

Seasonality.  If you're trying to short spx, take a vacation and come back end of next week.

Fri, 07/01/2011 - 16:07 | 1420040 oldman
oldman's picture

There's no one in the market, dude

Fri, 07/01/2011 - 13:04 | 1419385 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

A rate rise and people are surprised cash is running to corporate equity; imagine when cash runs into corporate debt ahead of Treasurie debt; imagine when cash runs into gold ahead of all else.  The dollar is not a safe haven, I repeat, the dollar is not a safe haven.

Fri, 07/01/2011 - 13:45 | 1419512 Downtoolong
Downtoolong's picture

imagine when cash runs into corporate debt ahead of Treasurie debt..

I started transferring mine last month, a little bit each week, mostly to shorten duration and avoid this mini bubble in the belly of the curve. They can QE all they want, even the Fed with Goldman's help can't prop it up  forever.

Fri, 07/01/2011 - 14:06 | 1419584 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Corporate debt will be the trade of the (next) decade, behind physical PM.  As US Ts lose their safe haven status, and money decides not to run to fiat, the corporate bond spread will crush government bonds.  This is a corporate takeover, after all.  That is why the governments were ok bailing out corporations.  Governments were sacrificed at the fascist alter so that corporations could rule the day.

Fri, 07/01/2011 - 13:09 | 1419389 JJSF
JJSF's picture

I'm wondering if we will ever get the long anticipated pre QE3 drop in equities.

My shorts are getting killed.

Fri, 07/01/2011 - 13:19 | 1419435 fiddler_on_the_roof
fiddler_on_the_roof's picture

you wont get that. get the fu*k out of shorts. I have been warning for the past weeks.

Fri, 07/01/2011 - 13:20 | 1419441 ssp2s
ssp2s's picture

Wait for it.  Even though the collapse will be rapid, you don't have to catch it at the top.  It will be a steep drop down, so plenty of money to be made once it starts.

The default thinking for surging yields is that the economy is moving and risk is on.  But this surge is happening only because QE2 has stopped and the demand for Treasurys accordingly has diminished.  The surging yields soon will collapse the equity market unless Ben steps in again.  But I think Ben has to let the equity market collapse before he can justify more QE.


Fri, 07/01/2011 - 13:38 | 1419494 topcallingtroll
topcallingtroll's picture

We already had the post qe2 drop in equities.

The pre qe3 drop in equities will occur shortly after the announcement of qe3

Fri, 07/01/2011 - 13:45 | 1419529 mayhem_korner
mayhem_korner's picture

We already had the post qe2 drop in equities.


Fri, 07/01/2011 - 15:18 | 1419822 topcallingtroll
topcallingtroll's picture

Partly tongue in cheek.

Keep in mind the market is constantly attemting to anticipate and discount the future.

Fri, 07/01/2011 - 17:37 | 1420283 spinone
spinone's picture


Fri, 07/01/2011 - 17:44 | 1420287 spinone
spinone's picture

You are red meat for the big boys. Helpless. Of course your fundamentals are correct, the the market is a fleecing machine, a wealth extracting machine, period. PERIOD. YOU WILL NOT MAKE MONEY TRADING GET OUT.

Fri, 07/01/2011 - 13:10 | 1419393 richard in norway
richard in norway's picture

stocks will take a tumble next week and while everyones talking about that silver and gold will get hammered



we saw this play not so long ago

Fri, 07/01/2011 - 13:17 | 1419428 lawrence1
lawrence1's picture

Are you putting your money where your mouth is, shorting or selling PMs?  I doubt it.

Fri, 07/01/2011 - 13:40 | 1419500 richard in norway
richard in norway's picture

short stocks, but if i had capital to spare would think about shorting PMs or oil


i expected the bounce to fade today, I'm really screwed today

Fri, 07/01/2011 - 23:19 | 1420767 geminiRX
geminiRX's picture

Gold mining stocks have already discounted the volatility in gold metal prices and are very oversold. One just has to look at the 20cent rise in Kinross vs the 18 dollar drop in gold as just one example in today's trading. I for one will be buying pm miners in the next few weeks.

Fri, 07/01/2011 - 13:41 | 1419514 jmcadg
jmcadg's picture

Got to be neither. Cash ready for a buy up in silver, long oil.

Fri, 07/01/2011 - 13:55 | 1419548 richard in norway
richard in norway's picture

i just saying that this looks like the perfect setup to take down the commodity complex while everyone's looking at the decline in stocks, which would fit in perfectly with QE3 


but i  admit, i know nothing, just guessing

Fri, 07/01/2011 - 13:31 | 1419474 mayhem_korner
mayhem_korner's picture

Paper price can get as hammered as it wants...just more decoupling from the physical!

Comex price doesn't reflect what ZH holders would take to part with Au or Ag.


Fri, 07/01/2011 - 13:09 | 1419413 RobotTrader
RobotTrader's picture

Which asset class has performed the worst this week?

Gold and Silver?



Tough Call......

Fri, 07/01/2011 - 13:19 | 1419438 lieutenantjohnchard
lieutenantjohnchard's picture

must be a slow day processing 1099's.

btw: is this a question you came up with? or did you lift it from somebody else?

h/t itg.

Fri, 07/01/2011 - 13:21 | 1419447 mayhem_korner
mayhem_korner's picture

Apart from Greece, which has had more stupid money inflow this week?

Gold and Silver?




Take your time...

Fri, 07/01/2011 - 13:30 | 1419479 topcallingtroll
topcallingtroll's picture

I'm with stupid

Fri, 07/01/2011 - 13:59 | 1419565 mayhem_korner
mayhem_korner's picture

Step back from the mirror, TCT.

Fri, 07/01/2011 - 13:49 | 1419527 Internet Tough Guy
Internet Tough Guy's picture

Momo, tell me again about the insatiable desire for gov paper, rates will never rise...You are the perfect fade, momo.

Fri, 07/01/2011 - 14:38 | 1419705 SheepDog-One
SheepDog-One's picture

MomoFader, the ultimate contrary indicator and dumb money call.

Fri, 07/01/2011 - 13:15 | 1419417 fiddler_on_the_roof
fiddler_on_the_roof's picture

if anyone has money, they should load up on Gold now and continue for a week.

stocks also will be great.

Fri, 07/01/2011 - 13:26 | 1419471 mayhem_korner
mayhem_korner's picture

first sentence logic...check

second sentence anybody? Bueller? Bueller?

Fri, 07/01/2011 - 13:31 | 1419485 topcallingtroll
topcallingtroll's picture

stocks will do great until they don't.  party on... just stay near the exit.

Fri, 07/01/2011 - 14:43 | 1419706 SheepDog-One
SheepDog-One's picture

Casino doors already chained shut from the outside. Uh oh.

Fri, 07/01/2011 - 13:33 | 1419488 fiddler_on_the_roof
fiddler_on_the_roof's picture

Stocks : dollar tsunami coming back to USA. tech stocks should do good to pay for those dollar coming back to home. high inflation. New scenario : Gold > Oil, silver,Grains > stocks > real estate > bonds,dollar .

Fri, 07/01/2011 - 13:35 | 1419476 fiddler_on_the_roof
fiddler_on_the_roof's picture

Nice Gold chart :$GOLD&p=W&b=5&g=0&id=p28385840989


if anyone having rights for posting pictures, please post it for all to see.

Fri, 07/01/2011 - 13:18 | 1419432 Steak
Steak's picture

Feeling like crap cause you were long the 5yr?  Well the Dr has a prescription, and not it is not cowbell (at least not this time), rather it is shaking your ass.  

Endless Summer (a playlist):

Fri, 07/01/2011 - 13:29 | 1419468 fuu
fuu's picture

oontz oontz

Fri, 07/01/2011 - 21:29 | 1420633 Cthonic
Cthonic's picture

Ahh, weekend listening.  Thanks Steak.

Fri, 07/01/2011 - 13:22 | 1419453 drswhaley
drswhaley's picture

How stable do you think the foundation of the leaning tower of PIISA is?

Fri, 07/01/2011 - 13:19 | 1419456 Gubbmint Cheese
Gubbmint Cheese's picture

I doubt this is a sign of more to come - the ISM was a major disappointment to the bond bulls (and the reality based who know there is no recovery). While I don't know... this seems to smack more of the unwinding of a position rather than a 'sign of things to come'.

If it was truly a sign of things to come, we'd see the economy starting to crumble.. its not (on the surface).

Nope - I'd say these dips on the UST 5 year are to be bought..  and (unfortunately) so is Robo's basket of LULU, Netflix, etc... also gold and silver.

Then you wait for the truth about the economy to reveal itself.. (and of course QE^n )


Fri, 07/01/2011 - 13:23 | 1419465 mayhem_korner
mayhem_korner's picture

So when the coerced money comes gushing back in to rescue the Ts, what happens to MoMofader's equities?

(I hope the banksters have got their holiday schedules straight so that both traders propping up the SPX aren't out on the same day...)

Fri, 07/01/2011 - 13:52 | 1419538 Gubbmint Cheese
Gubbmint Cheese's picture

that will be about the time they announce the tax holiday on overseas cash..

don't get me wrong.. this market run is melting my brain.. and adding to my booze bill each month. reality will kick in at some point.. just trying to figure out 'when'.

Fri, 07/01/2011 - 13:25 | 1419461 MiningJunkie
MiningJunkie's picture

Perfect correction in Au ! Shaking out all of the lemmings....

Fri, 07/01/2011 - 13:54 | 1419560 mayhem_korner
mayhem_korner's picture

$18/oz is a shakedown?  C'mon.  Most of the weak hands were sidelined in the mega-raids two months back.  This is noise.

I just keep accumulating in lots of about $5-$10K.

Fri, 07/01/2011 - 13:26 | 1419470 Chip
Chip's picture

Engineered to have all the FOX news watchers sell everything since on June 30 "all the banks will collapse without QE life support" 

Fri, 07/01/2011 - 18:48 | 1420383 fxrxexexdxoxmx
fxrxexexdxoxmx's picture

Fri, 07/01/2011 - 13:40 | 1419505 Bam_Man
Bam_Man's picture

Just a very predictable move by "the herd" out of bonds and into equities driven by the end of QE 2.

IMHO, it would be a big mistake to make anything more out of this. Once a debt ceiling/deficit-reduction deal is announced, Treasuries will start to get the love again. Right at about the same time that equity indices are at or approaching new highs for the year. Rinse and repeat.

Fri, 07/01/2011 - 13:50 | 1419545 Bartanist
Bartanist's picture

I am thinking that as long as there is a reasonable expectation that the US will be able to service its debt, paper gold will be declining in price as treasury yields increase.

... again, when yields get high enough, the temporary flow into equities will stop, money will move to treasuries for the yield and stock will take a mighty beating.

If the dollar survives all the political turmoil and the government shrinks the deficit then gold may very well revert to the mean.

Fri, 07/01/2011 - 14:08 | 1419606 SeverinSlade
SeverinSlade's picture

That's a lot of "ifs."

Like many others have said before, just tell yourself that the Fed and central banks of the world are doing this INTENTIONALLY.  Bernanke WANTS to destroy the US economy and US dollar...See?  It all makes total sense.

Fri, 07/01/2011 - 13:57 | 1419570 Platinum_Investor
Platinum_Investor's picture

What we don`t know is exactly how much power the US Fed has to manipulate things.

They sure do a good job with Gold and Silver and the miners.


Fri, 07/01/2011 - 14:10 | 1419588 Zero Govt
Zero Govt's picture

The Fed has 2 powers...

i). a monopoly on money

ii). first option on the US Govts great power, the income stream robbing citizens (taxation)

(strip away the window dressing and both are systemic criminal activity)

the only quiz question The Fed has to answer every month is, "To Print or Not to Print, that is the Question?"

Any nonsense about the Fed setting interest rates, check out the 3 Year Bond set by the market, the Fed follows it like a nodding donkey (Greenspan admitted it many years ago)

For Gold and Silver power, that'll be criminals for decades, never jailed once for decades: JP Morgan et al

Fri, 07/01/2011 - 14:08 | 1419605 RobotTrader
RobotTrader's picture

Do not fight Uncle Gorilla and his Gatling Gun that obliterates all the longs over the COMEX by firing off "short gold at market" paper contracts.

I warned you guys that "Paper" rules over "Physical" in today's world.

Until a hedge fund or foreign country sacks up and decides to take delivery of the entire COMEX inventory, Uncle Gorilla will continue his games.

Fri, 07/01/2011 - 14:32 | 1419623 Zero Govt
Zero Govt's picture

by "Uncle Gorilla" you mean The Fed?

You think the Fed is capable of manipulation (thought)? With Dull Boy Benny at the helm?!!

You're 'avin a larf Son!

JP Morgan created The Fed. The Fed is duller than dishwater and is manned by human zombies (crones) to do their precise bidding. Greenspan never had an original thought in his life, a perfect CV for a JPM Goldman Sucks plant. And Benny has never had any thought in his life! ...he says and does exactly what he's told to say and do

It's the oldest cartel/monopoly/front in US history

Fri, 07/01/2011 - 14:03 | 1419576 Zero Govt
Zero Govt's picture

"..wondering if PIIGS should be renamed to PIIS.. perhaps.. PIISA"

perhaps the Leaning Tower of PIISA


Fri, 07/01/2011 - 14:05 | 1419593 Bam_Man
Bam_Man's picture


When you add Turkey and Hungary to the PIIGS, you get "PIG SHIT".


Fri, 07/01/2011 - 14:20 | 1419641 Zero Govt
Zero Govt's picture

;)  Excellent ...i'm all out of ideas, but please keep 'em rolling in. . . 

Fri, 07/01/2011 - 14:34 | 1419683 n00b tube
n00b tube's picture


Funniest comment I've read all day.

Fri, 07/01/2011 - 14:10 | 1419597 SeverinSlade
SeverinSlade's picture

Here's a question I wanted to float to you fellow ZHers.

A lot of people tend to believe that when equities begin to get hammered, that PM's will follow down. I'm not so sure.

With registered silver at COMEX dropping daily, if silver drops too far, too fast, I think that would officially lead to COMEX defaulting. That's the last thing that the establishment wants.

I think silver and gold will trade sideways with downward momentum, but if silver dropped sub-30 to mid 20's I'd be shocked.

Anyone agree?

Fri, 07/01/2011 - 14:27 | 1419662 n00b tube
n00b tube's picture

Paper PM's will continue decoupling from physical pricing. Who would pay for paper when the underlying asset cannot be delivered? I really don't see Ag trading sub $30 ever again. If I had the FRN's, I'd gladly trade my fiat into each silver price drop. However, if some magical event occurred and COMEX started registering more silver, than was being delivered, paper should soar.

Fri, 07/01/2011 - 14:47 | 1419717 SeverinSlade
SeverinSlade's picture

I 100 percent agree. 

I think watching silver specifically tells you precisely what's actually going on in the global economy.

Silver is still treated primarily as a consumable metal like copper.  What did we learn this week?  The global economy is slowing, so demand for silver should theoretically drop.  Yet today, the stock market is jumping up yet silver is dropping.

TD and everyone on ZH is right.  This stock market rally is ENTIRELY based on risk. 

Fri, 07/01/2011 - 14:36 | 1419690 richard in norway
richard in norway's picture

i'm thinking that the window of oppertunity to smash PMs is rapidly closing as you point out.  which is why i have a feeling that it will be done next week under the cove of a decline in stocks, but as i have pointed out before "i know nothing" feel free to jeer at me if it turns out i'm wrong

Fri, 07/01/2011 - 15:43 | 1419938 Al Gorerhythm
Al Gorerhythm's picture

You're not Roninson Crusoe about just guessing. There are a few in the know, the rest of us are all barking and chasing at car tires.

Fri, 07/01/2011 - 14:16 | 1419617 n00b tube
n00b tube's picture

With LNKD over 1,000 P/E again, I'm tempted to liquidate all assets and go full MOMO to front-run the bond exodus into social media stawks. /sarc

Fri, 07/01/2011 - 14:14 | 1419622 PulauHantu29
PulauHantu29's picture

10 years still above 3%:

Shiller predicts they will fall below 3%. We'll see. Fear and uncertainty drive the Big Billionaire investors into what they consider "safe"...

Fri, 07/01/2011 - 14:15 | 1419627 FederalReserveB...
FederalReserveBankofTerror's picture

Post QE2 Game Plan:

1: Go "ALL IN" as if the end of QE2 or that bond spreads are about explode like a supernova really does not matter.

2: PIIG Out on "Independence Day", stuffing your face with barbecue and playing lots of Mexican Train cuz that is the loudest sound you will hear the night of the 4th if you live in Minnesota.

3: The 5th of July, the Party doesn't

4: Blackhole of wealth destruction, vicious cycle debt wipeouts, collective action clauses, CDS payouts...lamentation, wailing, war, intense nationalism, complete loss of all hope, capitulation to reality...crickets.

5: The largest transfer of wealth in the history of the world complete. You got what you got. What did you get?

6: New Game: Accumulation


Fri, 07/01/2011 - 14:17 | 1419632 FederalReserveB...
FederalReserveBankofTerror's picture

In the meantime the name of the game is "WTBO": Wait The Bastards Out!!!

Fri, 07/01/2011 - 14:23 | 1419646 Robslob
Robslob's picture

Just don't forget that someone has to pay for all that money printing and that hasn't even been considered yet.

We are just hopping from one crisis to another and when the "all clear" has been sounded, the economy turns around and employment improves THEN you will see an epic crash....simply because it will make no sense at all...

Fri, 07/01/2011 - 14:25 | 1419652 Robslob
Robslob's picture

Just don't forget that someone has to pay for all that money printing and that hasn't even been considered yet. We are just hopping from one crisis to another and when the "all clear" has been sounded, the economy turns around and employment improves THEN you will see an epic crash....simply because it will make no sense at all...

Fri, 07/01/2011 - 14:22 | 1419655 Agent P
Agent P's picture

Do a Scooby-Doo flashback to before 2008...who would have thought we'd ever be talking about a rout all the back to a 1.82 in 5s?  It's a crazy fucked up world we live in.

Fri, 07/01/2011 - 14:45 | 1419709 SheepDog-One
SheepDog-One's picture

Only cost us $28 trillion to get this 'great bull market' of DOW 12,000 something....and we're celebrating. What a stupid fucked up world.

Sat, 07/02/2011 - 13:47 | 1421316 hooligan2009
hooligan2009's picture

go back to october 2008 and imagine what the dow would have been had it been announced that the Government would run an accumulated deficit for the next three years of 5 trillion dollars (financed by the Fed) that all marked to market on loans would be abolished and that 44 million would get their food via stamps

Fri, 07/01/2011 - 14:56 | 1419740 Central Bankster
Central Bankster's picture

How hard is it to understand?  Collapsing bond market = Buy real assets

Lol @ the lemmings selling bonds to buy equities.  Wall street has done a great job "selling" the idea that equities hedge against inflation. 

Fri, 07/01/2011 - 15:25 | 1419863 YesMaybe
YesMaybe's picture

This is just ridiculous.  That very chart shows it was higher back in May, and what came of that?  I'm a complete doomer, I know the  global economy is headed for collapse in the medium term, but tyler is the boy who keeps crying wolf.  For example, his talk about SHIBOR.  It wasn't too long ago he was "confident this all time high will be taken out in a few days", and since he wrote that it's gone down every single day, except for one.  And that one day he was all talking about how the downward trend was broken, but then it went down again. Of course, ultimately doom is coming, but the specific indicators and warnings he points to are usually meaningless.


Fri, 07/01/2011 - 15:50 | 1419954 narapoiddyslexia
narapoiddyslexia's picture

Check the "Traffic Rank - Max" at this site -

Tyler's not dumb. And in the final analysis the system is not sustainable, so he's going to be right eventually. But, TD calls about 9 out of every 6 indicators of the coming crash. The 6 are still worth reading.

Fri, 07/01/2011 - 16:55 | 1420171 YesMaybe
YesMaybe's picture

Of course he'll be right eventually, that's what I said.  There'll be many huge drops along the way in the process of collapse, so there'll be a ton of chances for him to be right.  But maybe he should employ some perspective.  I don't know about 9 for every 6, I'll let you do the count, but in the short time I've been reading here it's been mostly hubris.

Fri, 07/01/2011 - 16:01 | 1420011 bill1102inf
bill1102inf's picture

The second the old people can get a decent savings account interest rate, kiss gold goodbye as the money is pulled out of that falling overpriced commodity and put into savings.  

Fri, 07/01/2011 - 16:35 | 1420128 Central Bankster
Central Bankster's picture

Try searching "negative real interest rates" and let me know when CDs yield north of 8% and I will join you.

Fri, 07/01/2011 - 17:26 | 1420260 Elmer Fudd
Elmer Fudd's picture

The second the old people can get a decent savings account interest rate, kiss the current government of the US goodbye as they can no longer make their finances work without killing the buck.

Sat, 07/02/2011 - 07:42 | 1421072 Grand Supercycle
Grand Supercycle's picture

Since DOW/SP500 is now EXTREMELY overbought, the reaction next week should result in a significant retracement.

S&P500 daily charts show updated rising wedge and possible head and shoulders pattern with target of 1,150 when confirmed.

Do NOT follow this link or you will be banned from the site!