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Bonds Now Expecting Worse Debt Ceiling Confrontation Than August 2011, Stocks - Not So Much
Amid the bluster of yet another press conference, equity markets chopped around jerking up and down 5 points at a time for the S&P 500. But one market, the Treasury Market, went only one way. While it is all too easy to watch the tickers and listen to the glib bloviation of any and all talking head exclaiming that there is no-way, zero-chance, totally unlikely, impossible that the US government would technically default - the Treasury-Bill market is less confident (10/17s +8.5bps to 22.5bps, 10/31s +7.5bps to 23.5bps). In fact, the T-Bill yield has now spiked massively more than during the 2011 Debt-Ceiling debate (and stocks - for now - have not).
T-Bill yields are blowing out today
and are now dramatically worse than during the 2011 debt ceiling debacle...
and please don't make the mistake of thinking that a 25bps 1-month yield is small and that the odds are therefore tiny... that is incorrect. The Treasury note will be repaid at some point (since the US will need to pay if it delays payment or risk the entire Treasuru complex collapse); this is merely a reflection of a discounting of 'When' that payment is made and a market that is growing more skittish at the "safety" of holding short-term money in bills. Bear in mind that current 1-month yields are the same as 18-month yields were 2 weeks ago before the debt-ceiling debacle began.
And do not forget what happened last time.
Charts: Bloomberg
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Considering i) the unfunded liabilities of the U.S., ii) the fact that we have a "debt is money" system, and the size of the sovereign bond market in question, this issue can not be easily dismissed.
Tick tock motherfuckers.
Obama said in April of 2009, "now is a good time to buy stocks". He also said last week about the debt ceiling negotiations, "this time is not like all the other times".
Now we know that was code for:
We ain't gonna prosecute, we ain't gonna look at your books, we gonna give you free money. So buy the shit outta those stocks cause we ain't gonna mark to market either. Those liabilities gonna be assets, and yo valuations gonna double off nothin.
So who wants to play cops and robbers?
Just wait til tomorrow according to this:
http://www.marketwatch.com/story/the-odds-of-a-stock-market-crash-on-oct...
Allow me to provide some counterpoint to your point;
http://www.newyorkfed.org/markets/tot_operation_schedule.html
Hitler clearly sees the future. https://www.youtube.com/watch?v=W9ka7bM90O0
Higher interest rates: why should the markets be worried about that?
Maria Bartiromo would remind you that this is great news for stocks, as that fresh Tbill money has to go "somewhere."
Right, who is the Federal Reserve selling to again? This statement seems rather inconsistent with this;
http://www.newyorkfed.org/markets/tot_operation_schedule.html
RE
Yeah: Gold and silver
looks like market is not "correct" and will need to do so.
let it explode and destroy this charade once and for all....
damned the consequences. better than this farce, above all
be rid of the current collection of thugs in DC
I only gave you +1 because the system won't let me give you +100000000000000000000000000000000000000000000.
Looking at the PMs you could be forgiven in thinking there was only blue skies and pink unicorns ahead. Yet Bart remains frustrated.
Maybe an old classic will put people in the right frame of mind by Elvis Costello:
I've been on tenterhooks
ending in dirty looks,
list'ning to the Muzak,
thinking 'bout this 'n' that.
She said that's that.
I don't wanna chitter-chat.
Turn it down a little bit
or turn it down flat.
Pump it up when you don't really need it.
Pump it up until you can feel it.
Back in 2011, there was an actual doubt whether we would have "QE4EVA"
Now? It's pretty clear to Wall St the Fed will print as long as there are enough trees....so the government "default" doesn't matter to them. And if SHTF, they can always just leave the country.
Anybody got a good link for a quick call on support and resistance levels?
FaceFuck done broke.
lknd tsla p pcln amzn the worm has turned
So if both sides 'dig-in' and neither budges and we default, when the 2016 president is elected can we "Blame Hussein" for 8 years? Since none of our elected offcials ever make mistakes, are held responsible or take accountability where will the blame lie? It sure isn't the Federal Reserves fault!! / sarc
Since Barry has been in charge, there hasn't been a budget passed. Technically the US has been in default since 2009.
If the Congress fails to set a budget, they are in violation of the Constitution and therefore illegitimate. With no budget the US government isn't authorized to spend a dime, yet they did. Again technically a default, because the expenditures were not authorized by Constitutional authority.
The algos are programmed to take all news as bullish. If a chart goes from bottom left to top right, BUY EVERYTHING!!!
I still like how the financial media claims recent IPOs have skyrocketed. Like Potbelly, which was up 100% on the first millisecond of trading. The stock opened and pretty much traded in a tight range all day. Saying the stock doubled from a price that never existed for traders, means the claimed IPO price never existed.
You couldn't get shares at the claimed IPO if you tried. The best you could do was buy at the pop and watch the stock go in a straight line all day.
IPOs are meant to double the value of insiders shares before they sell them to you. Then after they book the profit, they are all too happy to buy them back at a heavily reduced price a few weeks later with free Benny Bux.
Gotta love that win-win situtation, till it aint.
On a minute chart you can almost see the POMO fighting off any downward pressure.
S & Pomo doing its best to levitate.