Bond Yields Are Spiking Their Most In 2 Months

Tyler Durden's picture

Despite the ubiquitous BTFATH dip in stocks, Treasury yields continue to press higher from Rosengren's earlier comments. Combining overnight concerns about China's relative 'tightening' and Goldman's views that Taper may be sooner than many expect (even if it is counter-balanced with more dovish forward-guidance), bonds seem less than amused at the prospect of slower flow sometime soon. 30Y yields are back over 3.75%, the highest in 3 weeks and jumping the most in 2 months.


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LawsofPhysics's picture

tick tock motherfuckers...


Careless Whisper's picture

If you like low interest rates, then just keep 'em low. Dammit. Period.

HardlyZero's picture

Yes.  Anything less than 5% or 6% is they have been low for a few years now (since 2009).

Even the 10-yr has been increasing the last few days.

Going up.

max2205's picture

Pretty sure that GS said that to load up on the subsequent down open..Tyler you are playing their hand dude

Colonel Klink's picture

If you like your low interest rates, you can keep them.  If you like your bonds, you can keep those too.  The only thing we're excluding are your pre-existing freedoms.

Seasmoke's picture

I don't think that period word is the meaning you think it is. 

Panafrican Funktron Robot's picture

Yeah, they seem be trotting out the same people warning about a pullback last time, under the guise of "probable" tapering, just around the corner.

News flash:  the corner will never, ever, ever come.  That talk is entirely to pull in idiot suckers to take the other side of a one sided bet.  The stock market will continue to rise indefinitely on a nominal basis.  The thing to keep your eye on is the rate the market increases, vs. the rate of increase in the USD supply.  We've continued crashing another 40% since the March 2009 lows, in USD supply terms.  Welcome to the continuing depression. 

LawsofPhysics's picture

You know that the less "math savy" are going to junk you...

Dollar Bill Hiccup's picture

Yield shmeeld.

Pump up those internet stocks boys, cuz Twitter's coming and we want to get out of the syndicate with a healthy profit.

And once that's done with, well ...

FieldingMellish's picture

Time for Mr. Yellen to get to work. $100bn/month by March (or sooner!).

Lendo's picture

She needs to let her beard grow out.  


Beard=moar credibility.  Just like Krugman.

HardlyZero's picture

If she smokes large Cigars (not Tiparillos) or a large Pipe...maybe.

Can she wear coveralls...that might get the right "working" vibe.

Al Huxley's picture

Sure, the FED will taper, because what the fuck do they care if their balance sheet collapses as interest rates go through the roof and they discover the only reason anybody else will buy USTs is because they know the FED is their to backstop them. 


Go on guys, taper taper taper - maybe it will be in October!  Maybe it will be in December!  We're thinking it will probably be in March!  What a bunch of fucking clowns - the only ones dumber are the ones who take all their shit seriously - it's like believing a 2 year old who tells you he's going to be batman when he grows up, and making plans based on how the world will be with a real Batman in it...

Winston Churchill's picture

2 year olds have more credibility than the Fed.

The empress is naked(ughhh), and people are starting to notice.

fonzannoon's picture

I'm starting to think the fed has drawn a line in the sand on the 5yr and shorter. As long as they keep those rates at zero the 7yr and higher can bang around wherever it wants (within reason) going forward. Everyone that could refi already did. Everyone else either can't afford a home or has enough to buy cash with no mortgage. Housing is not as important as it used to be. So the fed will let go of the long end a bit if need be and just finance everything at the short end. The long end going up will just force more bond holders into stawks anyway.

Al Huxley's picture

I read somewhere that TWIST was done mainly to let the Chinese get out of their long-dated debt holdings.  The main thing the FED has to do is control the interest expense on the debt, so if they lose the long end they get into the situation of only issuing net new with shorter maturities - that would seem like a pretty dangerous (although unavoidable) path to be on.  I don't know how they deal with the rollovers on the existing longer-term stuff.  But these guys are pretty much geniuses, so I'm sure they've got a great plan worked out.

Pareto's picture

Agree.  Once they let the long end go - thats the end game, because as they issue new, plus mop up whats being dumped internationally, that will constitute outright debt monetization.  Rates will have to rise on the short end to compensate the bond holder for a depreciating dollar, which is akin to an inverting yield curve, right?  if you are long PMs, in my opinion, whats not to like?

LawsofPhysics's picture

"if you are long PMs, in my opinion, whats not to like"  - Paper or physical?  The "authorities" can and will manipulate the paper and all laws concerning paper to suit their needs.

hedge accordingly.

Pareto's picture

+ 1 Physical.  I have to be more clear about these things.  easy to forget.  Thanks for correction.

greatbeard's picture

>> Paper or physical?

What's the difference?  If you are buying or selling the price is set by paper.  I know, I know, sooner or later there will be a disconnect.  If the later comes after you're taking a dirt knap, WTF is the difference?

Al Huxley's picture

If you buy paper, you're not just defeating the purpose of owning gold, you're actually aiding and abetting the bullion banks in their scam to control the price.

greatbeard's picture

>> you buy paper, you're not just defeating the purpose of owning gold,

I understand that.  Other than some CEF, I'm not a paper guy.  But the statement made was concerning the price of gold.  Until things change, paper sets the price of gold. 

LawsofPhysics's picture

I don't think you understand why I (and many others) hold physical.  I don't trade my physical.  Just like my Grandfather, his kids and their kids and their kids and so on... have occasionally sold some to aquire new farmland or re-invest to make our business more profits.   Profits come during a good economy (when gold is cheaper) and we re-stock or add to the physical stash (just like CBs).

We can, and have, waited generations for bad debt to clear (which is what still needs to happen) and the business cycle to "reset" before deploying physical again.  If you are only concerned for yourself and your "dirt nap", then you really are missing the big picture.

Al Huxley's picture

Agree, although they're going to game PMs via the paper market until the very end.  I think when GLD is empty then they'll end the game and close the casino - that would be both the bond market and the gold suppression scheme.

Headbanger's picture

Huxley don't forget the Federal Reserve is mostly the big banks and not the Federal Government. And thus the Fed could fold with its member banks if they don't watch their ass. And i believe that's what they're starting to do now regardless of the economy or the "market".   So to think the Federal Reserve is anything more than a collection of big banks out to make money and stay solvent is very naive.

disabledvet's picture

the Fed is making money (a fortune actually) and s staying solvent. Having said that so are a lot of banks (public or private) of all shapes and sizes (nothing like "tanking the dollar" to get your way.) the Fed is monetizing FAR in excess of issuance. Interest should be negative actually...which given how inflation numbers get re-jiggered plus "growth is appeared" (where none seems to exist at least materially) they probably are...meh, rates go higher and equities could care less. think I might a bad bet this year bu still haven't pulled the plug on this boondoggle.waiting is not patience though.

Al Huxley's picture

I know, that's exactly what the FED is - but to think there's any way they can lose a game where they write and rewrite the rules to their own benefit and as it suits them, is what's naive.

Panafrican Funktron Robot's picture

"I'm starting to think the fed has drawn a line in the sand on the 5yr and shorter."

Seems like the turbo schedule is primarily in the longer end of the curve.

I think the problem is actually that $45 bln isn't enough to suppress the long end.  And please know that the 10 year above 2.5%, and particularly above 3%, is world destroying.  Think through the kind of absurd leverage applied to the assumption of continued low long term interest rates.

Sufiy's picture


Gold Catalyst - John Williams: Very Serious Trouble in this Next Year - Weaker Dollar and Hyperinflation 

John Williams is very respected economist who is providing  the real economic data, which is not massaged by the government desires and wishful thinking. His view at the crucial juncture for US Economy and Health of US dollar is very important to share now.

jubber's picture

getting smashed back down  again now

yogibear's picture

Again and again by the centrall banksters. The only thing that stops it is a crashing dollar.

Max Damage's picture

Melt up in progress

Vix Smash up in progress


yogibear's picture

LOL, the bond vigilantes are limp.

Sufiy's picture

Taper Anyone? China, Interest Expense On The U.S. Debt Outstanding And Gold.

US Dollar is running wild today trying to understand the FED's talk. "We will taper at some point data permitting, but will keep ZIRP until 2016 now" - with this kind of double talk from the both sides of the mouth anyone can get confused very soon. What is the best cure from the Taper Impulsive Disorder?  - Higher Interest Rates.ZeroHedge reports that they are moving up fast with the first sign of Taper confusion in the headlines and below you can find the reason why it is impossible to Taper anything now.    Amount of US debt is so huge at 17.1 Trillion, that interest expense is second largest after 2011 even with record low interest rates and stands at 415.7 B by the end of October 2103. Now double it and apply to US Economy general statistics, then do the same after listening to John Williams from about the real numbers. We guess that Chinese have run these numbers long time ago and buying all physical Gold now they can get.

yogibear's picture

Enough already. Countries outside the US need to pressure the US and crash the US dollar.

One fear is the US dollar comes rushing back and the Fed's ponzi is tested. The pound Sterling didn't act well when it lost it's currency crown.

LawsofPhysics's picture

which begs the question...  Why not let the "market" dump?  End purchases, let it dump and see who runs into treasuries?  I believe that a coordinated move by CBs around the world could easily chase money back into all kinds of soveriegn debt instuments (which is relly what TPTB in every government around the world want).  The bankers have finally done it, they control the world's capital and the "unforessen" thing is that "elites" in the west and China have been on the same page since the 1970's... 

vegas's picture

Why anybody would loan money for 30 years @3% - 4%, to the criminal enterprise, ponzi scheme outfit known as the US Gobermint is beyond me. One quick question; 30 years from now where is the price of gold?

RMolineaux's picture

While T bond yields have moved up slightly in the last few days, they remain below the level reached just a few months earlier.  I do not think too much should be made of it.  On the subject of Chinese motivations, we should keep in mind that they have been acquiring US T bonds for a long time and most of them are well above par currently in the market.  They will not be suffering significant losses if yields rise moderately.