Charting The Death Of Europe's Bond Markets

Tyler Durden's picture

From the financial repression and encumbrance of the central banker to the wild speculators and their angry 'fast-money' flows, we continue to hang on every tick in Europe's bond markets (for both validation of a political leader's view or confirmation of his asininity). The sadder truth is that Europe's secondary bond trading market has shriveled. Spain's Treasury just released August's daily average Spanish government bond trading volumes and they have plunged over 40% YoY - now at levels (under EUR40bn per day) not seen since 1996 (pre-Euro-zone). It strikes us that once they lose the secondary market then the primary market will be very close behind (thanks to liquidity concerns among other things) - unless of course the ECB really does soak up all future issuance and hold-to-maturity.


Just as with US equity trading volumes, European bond trading volumes are falling inexorably...


Source: Tesoro Publico

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q99x2's picture

oops there goes another water bug

MiltonFriedmansNightmare's picture

So what you're saying is, the capital markets are seizing up, but I still have a chance (as long as Central Banks hold to maturity).

LawsofPhysics's picture

Bring on ZIRP and let the bond holders start paying for everything!  - FAIL.

disabledvet's picture

Interestingly the EZ monetary authorities could do that...but they do not. Wild guess but perhaps "private interest" at play? I mean Ben Bernanke didn't even think twice about throwing Wall Street under the bus. Whoa...wait...he thought three times...AND DID IT THREE TIMES!

LawsofPhysics's picture

Look again, a number of bonds in Germany and the U.S. already have negative yields.  Many TIPS went negative already.  Grandma and grandpa are paying uncle sam to lose thier savings because it is "safer" already.

Unless of course they became bond traders themselves.

Dr. Engali's picture

"Deep and liquid markets" easier for the robots to manipulate.

crusty curmudgeon's picture

You just need the right spin on this...confident bondholders!

There.  Good news.

Grand Supercycle's picture


Longs please be careful.

Due to recent central bank intervention and short covering spikes, these daily charts are extremely overextended and significant correction expected very soon:


disabledvet's picture

The dollar amounts in the USA are paltry too. That is in THE PRIMARY MARKET. If all QE is doing is literally DRAINING the totality of the so called "secondary market"....insofar as the USA is concerned that would HUGELY deflationary. In other words "go long junk yards." Nothing is moving until that liquidity starts flowing. A Gold Standard would do that actually. Of course SO WOULD A STANDARD OIL.

Yen Cross's picture

 This is for Rick Santelli. Dr. Demento

orkneylad's picture

Just in time for the ESM to go live.

TheCanadianAustrian's picture

Compress this chart down to a 5 or 10 year span, change the starting year to 2012, and change SGBs to USDs and it might look pretty damned similar.

The worst trader's picture

Ammo and food........... better than Bonds tastes great less false filling.

blunderdog's picture


The only reason there's a sovereign bond market is to permit governments to continue deficit spending, right?  And the only reason anyone would ever want to buy negative-yield bonds is for quality collateral, right?

So this seems like it should go pretty smooth.  The bond-buyers back up the governments to curry favor so that they'll be prequalified for a government bailout when things fall apart.  Makes sense to me.

LawsofPhysics's picture

Unfortunately the central banks seem to be the only customers and hence (and somewhat unknown by the sheeple) the currencies are now at risk.  Maybe that is the plan, kill all the fiats and the central banks, who claim title to all physical assets via the purchasing they did with freshly printed fiat on the way down, threaten to foreclose on the earth unless everyone accepts the new one world fiat.

Personally, I see WWIII before this would come to pass.

blunderdog's picture

    Maybe that is the plan, kill all the fiats and the central banks...threaten to foreclose on the earth unless everyone accepts the new one world fiat.

Well, that seems like an obvious strategy to me, primarily because it's not a *major* adjustment.  You may be right--sure, WWIII is a good possibility.

But just switching the default global currency from the US dollar to [some other fiat token] isn't going to raise any eyebrows among the group who currently governs.  And for obvious reasons, they really aren't pushing for CHANGE.

AustriAnnie's picture

The hatred that still exists from WWII is part of why the new one world fiat is being rejected. (hell, look at the effects of WWII animosity on the Euro experiment)

Will another round of killing (WWIII) make everyone sing kumbaya and embrace one world fiat?  Not likely...

The problem with Empires is that they need the masses to be divided in order to exist.  But they also need the masses to "buy-in" collectively in order to maintain their existence/power.  Can't have both.

Yen Cross's picture

  Ask the swiss. They specialize in negative yield " financial instruments"   VIX

  Here is a real time bond chart for you guys.

Duke of Con Dao's picture

is Obama talking about posters on ZH?

YouTube - Knucklehead Posters of the World Unite! Throw off the chains of Ignorant Oppression!


hope he doesn't shoot a drone up our butt... 

nexus's picture

comment deleted by myself due to an error in reasoning

falak pema's picture

the fiat flush is now fully operative; both for bonds and stocks. Running to safe havens does not stop the aggregate rot. 

Hyperinflation and private bank deleveraging will be the rage come 2013. All to the deficit of real economy and state side balance sheet. 

What a slide this is going to be!