10 Year Treasury Yield Breaks To New All-Time Low

Tyler Durden's picture


10Y Treasury yields just broke to new all-time record low yields (marginally lower than the 9/23 1.6714% previous lows) and while the 'rates-can't-go-any-lower' crowd perhaps have not looked at JGBs recently (as in the last decade) in price terms, 10Y Treasury Futures have gained 4.6% since 3/20 swing lows while the S&P 500 has lost 6.0%. On the bright side, at least the front-end isn't inverted yet...yet.

At the same time 30Y yields are inching towards their own record low yields, having brokemn Deceber lows and back to Oct 2011 levels (still 7bps off the intraday low yields of 2.6922% for now).

Chart: Bloomberg

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Wed, 05/30/2012 - 08:46 | 2474903 Aziz
Aziz's picture

Definitely not a bubble

Wed, 05/30/2012 - 08:48 | 2474916 Colombian Gringo
Colombian Gringo's picture

Yeah, 2.69% on the 30 year, a guaranteed loss every year by inflation. No bubble here.

Wed, 05/30/2012 - 08:50 | 2474922 GMadScientist
GMadScientist's picture

Now that's patriotism.;)

Wed, 05/30/2012 - 09:10 | 2475036 scatterbrains
scatterbrains's picture

No patriotism comes when you pay the gov. protection money to hold the bonds, which will get even more expensive as the Euro splits apart and armed border skirmishes begin flaring up over there.

Wed, 05/30/2012 - 09:39 | 2475172 catacl1sm
catacl1sm's picture

When can I get a negative yield UST? I'm chompin' at the bit here!

Wed, 05/30/2012 - 09:47 | 2475203 Comay Mierda
Comay Mierda's picture

when the treasury came out with floating rate notes anyone who thought interest rates would rise is an idiot

market pressure will force this bond bubble higher

Wed, 05/30/2012 - 10:56 | 2475594 scatterbrains
scatterbrains's picture

You could always wait until gold ownership is outlawed and existing holders face 80% windfall profit taxes on the mandated sale back to central bankers (or face life imprisonment for being a monetary terrorist) but by then protection via paying to hold treasuries will probably cost you a lot more.  



Wed, 05/30/2012 - 09:54 | 2475239 GMadScientist
GMadScientist's picture

"when you pay the gov. protection money to hold the bonds"

What do you think negative real rates mean?!


Wed, 05/30/2012 - 10:49 | 2475550 scatterbrains
scatterbrains's picture

true enough, I thought you meant in a traditional negative real rates sense. 

Wed, 05/30/2012 - 09:07 | 2475020 LongSoupLine
LongSoupLine's picture

It's not the fall that kills you...it's the impact.

Wed, 05/30/2012 - 09:27 | 2475118 Cdad
Cdad's picture

Doug Kass Pain [DKP] must be going parabolic today.  Clear the shingles and prepare for the mother of all contrarian trades.

Wed, 05/30/2012 - 09:09 | 2475035 BorisTheBlade
BorisTheBlade's picture

New Normal = Old Fucked Up

Wed, 05/30/2012 - 08:49 | 2474904 Colombian Gringo
Colombian Gringo's picture

We are so screwed.

Wed, 05/30/2012 - 09:14 | 2475049 Taint Boil
Taint Boil's picture



Low yields mean high demand to safety and quality and signals that money is flowing to safety which means lower borrowing costs for everyone including the US government. Of course this wouldn’t make the government to act irresponsibly. Damn … sounds like I’m MDB. 

Wed, 05/30/2012 - 09:19 | 2475071 Jim in MN
Jim in MN's picture

More like no sane person dares to swim with the robot sharks with laser beams on their heads...AKA any paper market...except USTs...and even there it's a loss net of inflation.

The BEST you can do is a loss, net of inflation.  Let that sink in for a minute.

Negative real returns across all asset classes.  How's that for a party?

Wed, 05/30/2012 - 08:51 | 2474906 bdc63
bdc63's picture

And headed to 1.5% in short order ...

... pension fund managers with their 7-8% retrun targets? ... SO screwed ... and by association so are the rest of us ...

Wed, 05/30/2012 - 09:13 | 2474991 francis_sawyer
francis_sawyer's picture

So ~ that $94,000 a year pension that you get from NYC for your 20 years of standing there watching 2 other guys screw in a light bulb is in jeopardy?

Wed, 05/30/2012 - 09:16 | 2475058 odatruf
odatruf's picture

You mean it was promised in future value terms? The union negotiators ought to be lined up and given cigarettes. Outdoors of course, and far enough apart that no one has to suffer second hand smoke.

Wed, 05/30/2012 - 09:55 | 2475254 GMadScientist
GMadScientist's picture

Bankers first, in a line, so we can conserve ammo.

Wed, 05/30/2012 - 09:25 | 2475105 Jim in MN
Jim in MN's picture

LOL, yes, pensions are the cause of all the strife.  Should be an easy fix.  We're saved!


The point being that ANY investment or savings target is screwed.  Meaning more savings are required.  Meaning spending and consumption have to drop.  Meaning...we're screwed, in the conventional sense.


Of course it would be better if we hadn't been given every incentive on God's green earth to lever up on debt...and now, better if everyone got through the washout faster, not in a twenty-year grinding Japanified zombiefest.  But central bankers are stupid, corrupt, and unaccountable.  So, there you go.  We're EXTRA-screwed.

Wed, 05/30/2012 - 09:32 | 2475146 Winston Smith 2009
Winston Smith 2009's picture

Throughout the history of human civilization, the little guy always is.

Holy Grail Protest


Wed, 05/30/2012 - 10:15 | 2475371 djrichard
djrichard's picture

Jim in MN, bingo.

Wed, 05/30/2012 - 10:26 | 2475421 azzhatter
azzhatter's picture

a simple devaluation will take care of that, here's your $94K go get a loaf of bread

Wed, 05/30/2012 - 08:46 | 2474908 fonzannoon
fonzannoon's picture

not a bubble. Nope.

Wed, 05/30/2012 - 08:49 | 2474920 eclectic syncretist
eclectic syncretist's picture

Bubble = opportunity


Timing and capital preservation will be crucial to taking full advantage of this opportunity


Wed, 05/30/2012 - 08:55 | 2474953 Genève Barbegazi
Genève Barbegazi's picture

but even with cheap debt, the valuation problems of the past 10 years will ensure equity funding shortfalls everywhere...especially in CRE

Wed, 05/30/2012 - 09:04 | 2475001 youngman
youngman's picture

And you are killing savers......a bad lesson to learn...spending is good...saving is bad...

Wed, 05/30/2012 - 09:19 | 2475064 odatruf
odatruf's picture

It is not so much spending as debt. Leverage is good. OPM, as always.

Wed, 05/30/2012 - 08:51 | 2474928 Stimulati
Stimulati's picture

So this is a bubble but gold is not a bubble?  My money says this trend outlasts the gold trend.

Wed, 05/30/2012 - 08:55 | 2474952 fonzannoon
fonzannoon's picture

Do you have any understanding of how gold performs in times of negative real rates?

Wed, 05/30/2012 - 08:56 | 2474958 Terminus C
Terminus C's picture

But if you have no gold, you don't actually have any money...

"Gold is money, all the rest is credit." JP Morgan

Wed, 05/30/2012 - 10:00 | 2475279 GMadScientist
GMadScientist's picture

"You can't pick cherries with your back to the tree."

Wed, 05/30/2012 - 08:57 | 2474961 Genève Barbegazi
Genève Barbegazi's picture

Negative real rates are the "key metric" (as tyler, i think put it) to the gold trend

Wed, 05/30/2012 - 09:06 | 2475007 mayhem_korner
mayhem_korner's picture



It is, but the catalyst to decoupling real money (gold) from fake/debt money (fiat) is money velocity.  As long as MV is supressed, things will continue to seem normal to the sheeple, despite the deep decay.  Once MV picks up (bank runs spurned by inflation and/or panic), the decoupling will accelerate asymptotically.  IMHO.

Wed, 05/30/2012 - 08:58 | 2474967 mayhem_korner
mayhem_korner's picture

So this is a bubble but gold is not a bubble?  My money says this trend outlasts the gold trend.


The mother tongue of your "money" is fiat.  That's why it is telling you that. 

Re-orient your perspective to view things priced in gold and you will see that (1) gold is not a bubble, and (2) pretty much everything else is losing purchasing power.

Wed, 05/30/2012 - 08:51 | 2474929 midgetrannyporn
midgetrannyporn's picture

10y heading for 1%.

Wed, 05/30/2012 - 09:17 | 2475060 slaughterer
slaughterer's picture

10y heading for .001%.  There, fixed it for you. 

Wed, 05/30/2012 - 08:51 | 2474931 eclectic syncretist
eclectic syncretist's picture

Wasn't the Federal Reserve created in order to prevent booms and busts?

Wed, 05/30/2012 - 08:54 | 2474944 bdc63
bdc63's picture

no, silly, they were created to cause booms and busts ... how else are the wealthy and powerful insiders going to get wealthier and powerfullier? ... you don't expect them to play by the same rules as the rest of us, do you?

Wed, 05/30/2012 - 09:06 | 2475017 LeBalance
LeBalance's picture


Wed, 05/30/2012 - 08:59 | 2474968 Flakmeister
Flakmeister's picture

In all fairness to the Fed, it was formed at a time when unqualified amatuers were central bankers and things pretty much ran on their own.  The sucess of monetary policy was a crapshoot. Sort of like the case when a country's fortunes were at the mercy of the generalship of its "divinely chosen" king... 

The game has changed and the impact of the new rules is starting to show, aka, the death of debt based growth in a world of finite resources....

Wed, 05/30/2012 - 09:05 | 2475006 francis_sawyer
francis_sawyer's picture

don't kid yourself...

Wed, 05/30/2012 - 10:20 | 2475397 Flakmeister
Flakmeister's picture

Unlike you, who seems to be living in some kind bubble where you only hear and see what you want....

You are a shining example of American Exceptionalism and the Dunning-Kruger Effect....

Wed, 05/30/2012 - 09:04 | 2474998 smb12321
smb12321's picture

Just as the Energy Dept was supposed to lead us into energy independence, HUD into mass home ownership and the Education Dept into higher academic standards.   And if one the mandates of the FED was controlling the recession/expainsion actions then it, along with the others, gets a big fat "F".   (But send us a few hundred billion more and we'll fix the problem.)

Wed, 05/30/2012 - 09:16 | 2475061 Flakmeister
Flakmeister's picture

Beg pardon, when/who promised that the DOE would "lead us into energy independence"?

Wed, 05/30/2012 - 09:27 | 2475120 francis_sawyer
Wed, 05/30/2012 - 09:38 | 2475166 Flakmeister
Flakmeister's picture

Out of curiousity, do you even know what the DOE does?

PS He makes no such promise in your clip... either you are hearing impaired or having a learning disability... Based on the nonsense you type here, my money is on the latter...

Wed, 05/30/2012 - 10:08 | 2475212 francis_sawyer
francis_sawyer's picture

It's a waste of time arguing with you about anything (so this is my last comment on the subject)...

In the video clip, Carter is clearly referring to rolling 50 separate agencies dealing with energy into one... This became a reality later that year when the DOE (a cabinet level agency) was formed, with, the stated purpose of reducing America's dependence on foreign oil... The DOE has grown into a typical bloated behemoth employing over 16,000 federal workers (won't bother getting into pensions thereof), and a $25 billion dollar budget... Which accomplished what?... Um, director Stephen Chu thinks that people should paint their fucking rooftops white to help stop global warming...

That is clear for anyone to see... So all that is left is arguing as to whether you want to nitpick the above comment which failed to distinguish whether 'reducing' dependence on foreign oil, or, "lead us into energy independence" (which is just as vague a statement), are the same or not (in spirit)... In summary, arguing this matter is as much a waste of time as the DOE has been a waste of money...

Wed, 05/30/2012 - 10:18 | 2475382 Flakmeister
Flakmeister's picture

You are handwaving and trying to play semantics after I called you out on your bullshit....

Face it, you got pwned....

And as I suspected, you have no idea what the DOE does....nada, zip....

Wed, 05/30/2012 - 09:58 | 2475269 Stimulati
Stimulati's picture

Booms and busts were much more common prior to the Fed.  You could look it up.

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