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10Y TIPS Yield Above 0%; Highest In 19 Months
After 19 months in the red, yields on the 10Y TIPS have just shifted into positive territory. We saw a similar surge in TIPS yields in Q4 2010 / Q1 2011 which did not end well for stocks. This comes along with the simultaneous drop in the Fed's inflation gauge - five-year forward breakevens - which is now at its lowest in 9 months. This kind of drop has previously led to further QE action by the Fed, and right on cue...
- *BULLARD SAYS INFLATION IN U.S. HAS `SURPRISED TO THE DOWNSIDE'
- *FED'S BULLARD SAYS LOW INFLATION MAY WARRANT PROLONGING QE
- *BULLARD SAYS HE'S STILL OPTIMISTIC U.S. INFLATION WILL RECOVER
As Barclays notes:
Ultimately, we think breakevens, particularly forwards, are a buy. We believe the Fed’s reaction function has not become more hawkish and that the market has missed that tapering is conditional on a strong economy.
10Y TIPS yield...
5Y 5Y Forward inflation expectations...
The embedded par floors in TIPS have not richened as they have in past episodes of market stress suggesting this move is more a shift in fundamental sentiment that technical/flow driven...
Charts: Bloomberg
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Brent is 104.50 I call Bullardshit.
Yes, how is 6-8% inflation low?
Ben fuckin Bernanke keeps saying inflation is well contained....i see prices for food going up everyday or packaging getting smaller...thats fuckin inflation!
I am hoping that one there is someone that works in the Federal Reserve that will come out like Snowden did and basically tell the whole world that the NY Fed, Ben Bernanke and the whole FOMC is the biggest ponzi operations in the history of the financial world. but then again...we are talking about these fuckers who probably came from or connected to Wall Street...so I doubt there will be any honorable men or women that would do that.
That would be suicide.
If you want to continue to work on WS, you go along to get along.
Solution to "low inflation" is simple, really. Just change the way CPI is calculated and include SNAP foodstamp usage. That will bring back your "inflation" Bullard.
All of these yield curves are managed and massaged so as to sell the latest policy. Inflation is far from too low, but these liars need some way of showing the public that MOAR insanity is needed.
If inflation is too low and "a reserve currency can never hyperinflate", then why the hell aren't these idiots outright monetizing everything? I mean, at some point the entire definition of the system is called into question when they claim no inflation yet are printing over $1 Trillion a year (that we know about, anyway).
The farce goes on.
bullard never goes to the grocery store or the gas stations. servants do that for him.
Forward! Rates rise, inflation concerns rise, MBS prices fall, Bernanke starts drinking heavily.
http://confoundedinterest.wordpress.com/2013/06/10/sorpresa-treasurytips-rates-spike-agency-mbs-prices-continue-slide/
Just remember ya'll, the FED will stop at nothing to defeat deflation. Do we really need to know moar ???
I feel like Bill Murry in Groundhog Day!
Obviously no one at the FED looks at a food or energy payment receipt.
I just spent $2.99 to buy a four pound bag of sugar. That was on sale. That is insane.
We don't eat a lot of sugar. The last bag was one of those funny "five pounders." I would guess I spent about $1.89 or so on it; that's what sugar used to cost on sale, not long ago.
I checked my annual (credit union) credit card statement booklet. We spent the same amount of food in 2012, as we did in 2011! Wow, good times! Then I remembered that I've been eating 30 percent fewer calories (stopped taking a med that made me overeat). Ooops. Well, I guess that if we all eat 15 percent less each year (there are two in our household), our food prices won't go up at all.
Bullard...lol these guys have such fitting names. I won't rest until I see a Fed head named Assrammer though.
Isn't Frederick Assrammer the new guy over at the IRS?
No, that's Lawrence Balllicker at the IRS. Assrammer is DOJ. BTW, Amy Shitflinger is the new MUTHAFCKR Director.
only a matter of time before oil explodes up and we will see the inflation
I guess that's why Amazon is about to make another all-time high. I can't think of any other reason. What a farce.
Moar QE while they start tapering.
Transparency at it's finest.
"Bullard calls Dick Fisher a total assclown"
"Dick Fisher says Bullard wears fishnet leggings"
It makes sense that we got upgraded for our sound monetary policy.
Seriously. How can any of these people (central bankers, wall streeters, politicians, media) sleep at night? Nothing but lies. Do they really believe that this is somehow in the public interest? Nobody could possibly believe that. In which case they are criminals. Hang 'em high!
*BULLARD SAYS HE'S STILL OPTIMISTIC U.S. INFLATION WILL RECOVER
There's something very wrong with the world if everyone - including central bankers - fret about the absence of inflation....
In Japan's case at least, a credible argument can be made for stoking inflation, if nothing else simply because it would represent something new.
http://nipponmarketblog.wordpress.com/
"In Japan's case at least, a credible argument can be made for stoking inflation"?
No, there isn't a credible case for that kind of monetary madness. Having sound money and repealing legal tender laws would render that point moot.
As it stands now, the country is finished.
Won't someone think of the poor, poor, inflation?
Dees bubblez ain't gonna float demselves!
Or your premiums for medical care. Amazing. Can't have lower prices,no Sir. That might prolong the demise of the middle class. We already know those at the bottom of the ladder are already toast. Thank God for the 5% that keep this country on a sound footing. Obama should be proud of what he has done. Yup, Michelle is all set till the day she dies. Freedom! Ha.
"We saw a similar surge in TIPS yields in Q4 2010 / Q1 2011 which did not end well for stocks."
Right but the S&P shot up 180 points first.
The Fed have a mandate for STABLE prices not "%^&ing INflation... which is unstable and THEFT
Arrest Bullard for treason and telling fairy tales and for being a fairy and coming into power from inherited wealth and for being sexually attracted to stuffed bunnies. End the FED.
Remind me to check and see if my bucket in the pasture is full of unicorn piss yet. It gives you a far better buzz than a 6-pack of beer and is the only thing I can afford since booze has doubled in price over the last 4-5 years.
Silver bitchez.
The price of anything made or provided in the US-Fucking-A is through the roof: healthscare, energy, food, education and housing.
Anyone that believes inflation is 2% is on crack. The only inflation tracked by the United Stassi Government's CPI is bullshit imported from China. The CPI is nothing more than a Made-in-China Inflation Index.
Wake up you stupid fucking americans.
Food energy = up
House price = sideways to down depending on where you live
wages = down
jobs = down
Each sector is a ltitle different but overall "sluggish for years" as El Erian said the other day.
it's just silly ... the inflation data have been manipulated by government for so long that anyone living in real-life knows it's meaningless ...
She's gonna BLLLOOOWWWWWW!!!!
I smell Bullard Shit here....
measured inflation across the globe is trending down. not unexpected given that the global economy is still deleveraging. the real yields spike is notable and can be attributed to the QE taper expectations. real yields also affect gold prices among other things.
Read my lips, QE ain't gonna stop!!!