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So Much For "Sell Bonds, Buy Stocks": Net Long Positions In 10 Year Treasury Highest Since March 2008

Tyler Durden's picture




 

Remember when back in March Goldman presented the "Long good buy: the case for equities", when they, and everyone else of course, said the once in a generation opportunity to short bonds and buy stocks is here (and when BlackRock chimed along, saying the time to go all in... BlackRock ETFs.... is here)... Or when in September, right after QEternity, Goldman, having blown up previously on said trade, reiterated its call to go long stocks and short bonds (and when BlackRock chimed along again, saying the time to go all in... BlackRock ETFs.... is here). Well, so much for that. Or rather, those. As of last week, the speculative long exposure in the 10-year Treasury more than doubled in the past week, soaring from 79,296 to 169,456 net contracts, the highest position since March 2008. Looks like Uncle Ben will need to come up with more creative and counterintuitive ways to get traders to stop frontrunning him in purchasing every bond in the open market, and herd them into buying stocks...

Source: CFTC Commitment of Traders

 

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Mon, 11/05/2012 - 09:36 | 2948259 GetZeeGold
GetZeeGold's picture

 

 

Rut row.

Mon, 11/05/2012 - 09:44 | 2948287 Muppet of the U...
Muppet of the Universe's picture

Anyone see what Benji and his GS goons just did right thur?  Forced the buy bonds buy market scenario into action.  AGAIN.  Seriously.  I hate you Benji.

Mon, 11/05/2012 - 10:23 | 2948387 JPM Hater001
JPM Hater001's picture

You missed the part where he kissed Geitner on the lips.

Mon, 11/05/2012 - 09:38 | 2948266 Water Is Wet
Water Is Wet's picture

The U.S. isn't making any more debt!  Buy now or be priced out forever! /stupid

Mon, 11/05/2012 - 09:39 | 2948272 Lost Wages
Lost Wages's picture

Maybe a quick interest rate spike is in order to smoke the lil' buggers out.

Mon, 11/05/2012 - 09:47 | 2948291 malikai
malikai's picture

The 10 year is way overextended compared to the rest of the curve. This will end in tears.

Mon, 11/05/2012 - 09:48 | 2948292 disabledvet
disabledvet's picture

With New York City about to default on 100 billion in debt? "Go ahead...make my day...

Mon, 11/05/2012 - 09:40 | 2948277 LawsofPhysics
LawsofPhysics's picture

More burnt muppets.  same as it ever was.

Mon, 11/05/2012 - 09:41 | 2948280 evolutionx
evolutionx's picture

german yields 2j again negative. Means: Gernany leaving EURO??

 

http://www.cds-info.com/

Mon, 11/05/2012 - 09:52 | 2948297 Non Passaran
Non Passaran's picture

Who knows, but wasn't it like that late last year?

Mon, 11/05/2012 - 09:42 | 2948282 SheepDog-One
SheepDog-One's picture

Everyone 'gettin it wrong' these days theyve reached 'max market chaos' on the pirate ship known as Wall St.

Mon, 11/05/2012 - 09:43 | 2948284 Orly
Orly's picture

...and the futures turn green...

Mon, 11/05/2012 - 09:46 | 2948289 disabledvet
disabledvet's picture

Headline wrong. Should read SHORT bonds buy equities not merely "sell them." (As you say in the article i might add.). And of course with no less than Goldman itself sitting on at least a trillion down on its short position in treasuries WHILE EQUITIES HAVE DOUBLED I think such talk is to be expected. Sorry but i'm not going to buy your net long position in Social Media either Goldman. you're down at least 100 billion there as well. If you're asking me to pick a winner between the Fed and Goldman I'll take the Fed..."with a 100% increase in fuel costs in the next week Alex. For One Trillion." And the question is....

Mon, 11/05/2012 - 11:35 | 2948634 LawsofPhysics
LawsofPhysics's picture

..."who owns the western world?  GS and the Fed bitchez..."

Mon, 11/05/2012 - 09:48 | 2948293 rsnoble
rsnoble's picture

Since there's no voluntary stock purchases we'll have to move to involuntary stock purchases.  Involuntary stock deductions from your paycheck, which will sit well with everyone recently getting their hours cut to avoid obamacare, wallstreet takeover of SS etc etc etc.  They'll do anything to keep going. Just ask a drug addict. 

Mon, 11/05/2012 - 10:25 | 2948392 JPM Hater001
JPM Hater001's picture

I was going to answer but the implications were too dangerous...

Mon, 11/05/2012 - 09:50 | 2948294 govttrader
govttrader's picture

I recall the last time this happened..it was a great opportunity to sell a pop.  Mark my words...the higher the long end of UST trades today, the more i will be selling.

 

http://govttrader.blogspot.com/

Mon, 11/05/2012 - 09:58 | 2948314 Dr. Engali
Dr. Engali's picture

Another rat jumping ship over at MS..Paul Taubman is retiring at the ripe old age of 51  by the end of the year.

 

http://www.bloomberg.com/news/2012-11-05/morgan-stanley-s-taubman-to-lea...

 

 

Mon, 11/05/2012 - 09:57 | 2948320 sasebo
sasebo's picture

What the fuck is going on? ben ain't no fucking uncle --- he's a delusional asshole. 

Mon, 11/05/2012 - 10:00 | 2948325 timbo_em
timbo_em's picture

BernanQE just has to pull his BoJ card and announce that after monetizing agency MBS, the stock market will be next. I'm sure he has no problem with this move.

Mon, 11/05/2012 - 10:03 | 2948330 BigT4451
BigT4451's picture

I don't see the point of this article.  The treasury position might have been a small loser, but its not like you lost a ton of money considering treasuries have an effective 0% ceiling.

On the other side of the trade, your losses in treasuries would have been more than offset by your gains in Equities this year.  And eventually, treasury prices will go down.  So that's just a termporary (small) unrealized loss offset by gains.

Come on zero hedge.  Articles like these are rubbish.

Mon, 11/05/2012 - 10:52 | 2948331 edifice
edifice's picture

And the bond bubble just keeps growing... It's astonishing, since the yield curve on the 10-Year is negative for something like 15+ years.

Mon, 11/05/2012 - 10:03 | 2948332 Itch
Itch's picture

If Romney wins those longs will be skinned alive, but they are obviously not entertaining that particular prospect ...

Mon, 11/05/2012 - 16:25 | 2948341 Anasteus
Anasteus's picture

When Goldman says "Long good buy" it reads "Long good bye".

Mon, 11/05/2012 - 10:46 | 2948446 tooriskytoinvest
tooriskytoinvest's picture
Conditions are so bad, they are just plain bad. (Sandy and California gas crisis are just the catalyst this time) I believe anything which can trigger the collapse of consumer spending and slowdown in economic activity will crash the stock market because the institutions will suddenly begin betting on a fall in the oil price and then stock market.

‘History Does Not Repeat Itself, But It Often Rhymes’: Gas Prices Are Falling So Fast Because The Economy Is On The Verge Of Collapse

http://investmentwatchblog.com/history-does-not-repeat-itself-but-it-often-rhymes-gas-prices-are-falling-at-their-fastest-rate-in-4-years-because-the-economy-is-on-the-verge-of-collapse/

NY men charged with hoarding gas — took 120 gallons in five-gallon buckets!

http://www.nbcconnecticut.com/news/local/Two-Arrested-for-Gasoline-Hoarding-177184891.html?dr

Mon, 11/05/2012 - 11:20 | 2948560 moneybots
moneybots's picture

Didn't the Hunt Brothers try to corner a market?  How did that work out for them?

 

Bernanke is manipulating a market and the market is manipulating back at him by front running him.  These things always end badly, yet they keep doing them anyway, because end badly is some point in the future.

Mon, 11/05/2012 - 11:22 | 2948567 WhiteNight123129
WhiteNight123129's picture

You have to have balls and stamina for a short. Short treasuries, buy Tobacco companies with high dividend.

Shorting the treasuries is like getting a loan from teh Gov at less than 3% for 30 years. With that you can buy Farm land, Silver etc... you will repay with confettis...

If the Fed stops printing yield will rise, if the US manages to create inflation yields will rise. If the US goes bankrupt big haircut. Lowest yield in 230 years, yet worst fiscal situation in 200 years (fiscal situation was better during civil war). And yet, the most crowded trade. If that is not a bubble, what is a bubble?

 

Mon, 11/05/2012 - 11:24 | 2948570 moneybots
moneybots's picture

"On the other side of the trade, your losses in treasuries would have been more than offset by your gains in Equities this year."

 

What have mutual fund outflows been running?  First one has to have money in equities to have gains in equities.

Mon, 11/05/2012 - 11:28 | 2948593 tok1
tok1's picture

that's nice information if the markets that long with the potential
for Romney to get in ( and possible large shift to lower tax private sector
demand ) and higher rates ..

tonight might be a good chance to go short 10y's as some longs may
get nervous to hold into tomorrow ..

especially at these levels above 133.00 top of range .

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