US 10Y Yield Hits 3.019% - Highest Since July 2011

Tyler Durden's picture


While a few media outlets had premature releases yesterday, Bloomberg data just confirmed that for the second time this year, 10Y US Treasury yields have crossed 3% (it was 3.005% in Sept 2013) breaking to the highest since July 2011 (right before the yield collapse after the US debt-ceiling downgrade debacle). We are sure the media will proclaim this as 'proof' that the recovery is different this time, except the term structure continues to flatten (suggesting less faith in the future) and to spice things up 30Y mortgage rates have surged to 4.63% - almost the highest since May 2011 - but again, apparently, this won't affect the housing recovery either (even though mortgage apps are down two-thirds from their highs).

The last 2 times 10Y was at 3%, S&P was at 1340 (and fell considerably after) and 1650.


It seems WSJ and CNBC may have their bond math off by a fraction as Bloomberg never triggered until now...



Charts: Bloomberg

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Fri, 12/27/2013 - 09:15 | 4278786 Headbanger
Headbanger's picture

Told ya it would yesterday.  So it's a day late.

Fri, 12/27/2013 - 09:25 | 4278793 GVB
GVB's picture

Actually it should be higher than Greece's. +10% to cover risk (at least)

Fri, 12/27/2013 - 12:04 | 4279110 SafelyGraze
SafelyGraze's picture

in the current low-interest climate, a 3% return is pretty decent on your security money.

especially with inflation at only 1%.

municipal bonds, at 6%, have been an even better place to park those funds.

for your growth funds, S&P 500 has proved itself to be the smart place for rocket-shot performance

all in all, 2013 was one of the best years ever for traditional prudent investors.

the financial advisor in everybody's neighborhood 

ps - let's set up a meeting to discuss your 2014 portfolio needs.

Fri, 12/27/2013 - 12:18 | 4279145 Spigot
Spigot's picture

A shit sandwich being served up. Bon Appetit!

Fri, 12/27/2013 - 14:32 | 4279627 StacksOnStacks
StacksOnStacks's picture

Looks a little runny to me.

Fri, 12/27/2013 - 14:31 | 4279638 Spigot
Spigot's picture

Free gravey, too!

Sat, 12/28/2013 - 00:21 | 4281054 SafelyGraze
SafelyGraze's picture

it has come to my attention that someone may have removed the /sarc from the end of my previous post

Fri, 12/27/2013 - 12:19 | 4279159 GVB
GVB's picture

You believe inflation is at 1%..

Fri, 12/27/2013 - 16:07 | 4279900 Oracle 911
Oracle 911's picture

Either you forgot the /sarc tag or made the gay coming out on twitter/facebook after account hack.

Fri, 12/27/2013 - 10:16 | 4278879 thunderchief
thunderchief's picture

Janet to Ben..

"What the F#%& are you doing?!!"

Fri, 12/27/2013 - 09:16 | 4278789 digitlman
digitlman's picture

Pretty exciting!

Fri, 12/27/2013 - 09:28 | 4278800 Obchelli
Obchelli's picture

Looks like FED has realy great grip on it otherwise stops would trigger and it would be in 3.10 area immediately after taper. This didn't happen... scenarion that FED will lose control at some point is not materilizing... At least I do not see this

Fri, 12/27/2013 - 10:35 | 4278844 Headbanger
Headbanger's picture

That's a reasonable conjecture.  Not sure if one can conclude how much the Fed can prevent Treasury rates from rising now that they've demonstrated their willingness to taper.

And then there's this chart we saw here a few weeks ago saying the 10 Year yield is going to explode:

But I think it's the simple fact that people need to start taking  money out of stocks cause they're not earning it and there's no cash flow anywhere.

It's a huge cash crunch which the Fed can't possibly counter cause they're no "money multiplier" in this horrid economy to leverage their stimulus.

Fri, 12/27/2013 - 10:02 | 4278854 Gutenberg
Gutenberg's picture

Fed has not tapered yet. Still printing 85 billion a month. Starts January 24 i believe. While printing 85 billion a month, 10 year nearly doubled in less than six months. Say going to taper ten billion. Would have to do that seven more times at this bond base. Do the math. Oh yea i think every point up on the ten year increases interest on debt 200 billion a year. Again do the math.

Fri, 12/27/2013 - 10:33 | 4278871 Headbanger
Headbanger's picture

My brain hurts from doing all that math..    Oh wait, it could be from something else I keep doing..

But I think the "Yield Monster" has just woken and is heading out of its cave now..

Fri, 12/27/2013 - 12:02 | 4279092 Obchelli
Obchelli's picture

If you mean 1 basis point rise it;s only 18 billion per bp. If you meant 1% yes it;s 170 bln... But hey what it is for FED? they will just print it for government

Fri, 12/27/2013 - 09:29 | 4278802 Global Hunter
Global Hunter's picture

TPTB won't let this stand, this means War (see previously posted ZH story)

Fri, 12/27/2013 - 09:35 | 4278807 h0oS
h0oS's picture

The trend is crystallising, the Feds efforts in manipulation are weakening, faith in US debt is fading and market will punish interference without remorse in due course. As for gold, well, no one can rule out another drop but from where I'm sitting the yellow metal is looking damn cheap when priced in fiat currency.

Fri, 12/27/2013 - 09:39 | 4278817 new game
new game's picture

plus, plus and yes stay the course-resist paper crap!

10 year black swan will need emergency intervention soooon.

yellen for yellen-emerg meeting for primary dealers to buy with freash created fiat thru the discount window...shovel that shit NOW, we got a problem in our painted tight corner!

Fri, 12/27/2013 - 09:34 | 4278808 BandGap
BandGap's picture

The snapping point is ~ 3.5%. At that point it's every man for himself (unless you want to band together for some other type of festivity).

Fri, 12/27/2013 - 09:37 | 4278809 TideFighter
TideFighter's picture

Maybe, the only black swan out there, right now.

Fri, 12/27/2013 - 09:34 | 4278810 new game
new game's picture

makes my day-trying to buy a discounted acreage property with cash!

10 year to the point of real estate collapse(again) TIA.

fuck yellen and her mortgage backed manipulation...

let the markets price the true cost of risk!

fuck debt and the gov horse it road in on...

Fri, 12/27/2013 - 09:42 | 4278818 Pig Circus
Pig Circus's picture

From a friend who manages his own fund a fair and balanced article from CNBs:


I love this lie:

"We think an upward drift in the 10-year yield is likely as we hit year-end and into the new year," said Russell, who attributes the advance to the Fed being less of a buyer of Treasurys as well as what is "undoubtedly a firmer domestic macro situation."

The FED hasn't slowed down its purchases yet and we all know the macro sucks as Xmas sales will be down for the first time in years.

Fri, 12/27/2013 - 12:24 | 4279170 Spigot
Spigot's picture

Pig, I think you're failing to see the larger, bigger macro picture: China falling apart. Viewed in this context, anything that is not China, and anything that is happening is better than China, so it's all good, for whatever reasons. The verbage is verbage. The Chinese are trying to get cash and selling wehatever they can to get cash. US T's come to mind. So, be of good cheer. Our Macro is better than your macro.

Fri, 12/27/2013 - 09:41 | 4278822 Ignorance is bliss
Ignorance is bliss's picture

Looks like the hammer is coming in 2014. Too many unresolved conflicts seem to be manifesting themselves in short order. Some of the ones that come to mind.

1. Spectacular gold flow from West to East.

2. Bloomberg reports that the LBMA vaults are almost empty

3. Gold price discovery investigation in London

4. German gold repatriation efforts = failure of the system to deliver

5. National debt and QE to infinity

6. Shadow derivative market tied to 3% interest rate

7. Obamacare = self inflicted crises

8. Elections 2014

9. Europe bond downgrade by S&P

10.  U.S. leadership failure in Syria with unrealized repercussions in Saudi Arabia, Libya, Israel, Iran, Qatar, Egypt, Pakistan, and beyond. 

11. Obama social security number back in the news

12. NSA debate / Snowden in the news

13. Efforts to curtail gold demand in India: Presidential elections in India (2014)

14. Transatlantic trade agreement = Trading away America

15. china / Japan conflict with continued escalations

16. Fukashima cover up and unrealized consequences

17. Global unemployment in the west

18.  U.S. debt ceiling debate in Feb 2014

19. Stock market bubble = unresolved

20. Housing market bubble (popping) 


Fri, 12/27/2013 - 09:56 | 4278842 GVB
GVB's picture

21. Brazil gives USA (or NSA) the finger through cancellation of their Boeing F18-order. Sweden's Saab is happy to accept - that's what I call warfare (especially when military equipment is involved)



Fri, 12/27/2013 - 09:49 | 4278827 Obama_4_Dictator
Obama_4_Dictator's picture

Lol....and they haven't even tapered yet!!

Fri, 12/27/2013 - 10:42 | 4278933 Boston
Boston's picture

Um, no. You have it backwards.

Look at the last 4+ years---whenever QE ebbed, yields tended to FALL. And so did stock prices.


Fri, 12/27/2013 - 09:58 | 4278840 yogibear
yogibear's picture

The 10 year should be much higher. Room to soar.


Fri, 12/27/2013 - 10:06 | 4278841 Save_America1st
Save_America1st's picture

I don't know if you all listen to the many podcast interviews that Kerry Lutz does on the Financial Survival Network site.  But each week he does an interview with Andy Hoffman (formerly "Ranting" Andy Hoffman) from Miles Franklin.  Andy is one smart dude and is great to listen to.

You should definitely catch the first half of this interview as they discuss the Fed QE and "tapering" lies.  Andy has calculated that the Fed was not monetizing 85 Billion per month and that the 10 Billion "taper" was already priced in and is nothing but spin for the sheeple.

Andy calculates that the Fed has actually been monetizing about 135 Billion per month, and so even with a so-called 10 Billion "taper", the Fed is still actually monetizing 125 Billion per month!!!  As always, things are much worse than anyone knows.

Here's the link:

This shit just gets worser and worser by the minute...keep stackin' that phyzz as much as you can folks.  It won't be around at these prices much longer. 

Fri, 12/27/2013 - 10:06 | 4278857 dick cheneys ghost
dick cheneys ghost's picture



''Slow death collapse, eventually liquidation of the non-performing liabilities... come back in a generation or two. 

"And nobody cares."

''Caring has nothing to do with it, all the "care" in the world is not going to change the Math to keep the system going.   The caring should have taken place when your parents or grandparents started yet another system based on usury thinking the result was going to be different.

The market is doing exactly what it is suppose to be doing. 

- Expand

- Peak

- Fail to expand

- Collapse <-- you are at the very beginning process of this

- Liquidate''

Mako ZH 2010

Fri, 12/27/2013 - 10:07 | 4278860 fattail
fattail's picture

Phony economic numbers about to get a dose of reality.  I am curious as to how far they can push the taper before they have to call it off.  3,5  to 4 %…

How low does AU go before market prices in the final version of QE.

I am waiting for that rubber band to snap.

They lower gold goes the more absurd their position.  Someone should tell them we can see their cards.

Fri, 12/27/2013 - 10:10 | 4278864 CheapBastard
CheapBastard's picture

I wondered why the housing market is collapsing ... mainly slower sales and too-many-to-count 'falls outs.'

Stagnant wages, stagnant job growth and rising rates.

Fri, 12/27/2013 - 10:13 | 4278869 Smuckers
Smuckers's picture

Oh the Treasury upside is frightful,
And for stocks, it sure ain't delightful.
Golds the only asset class I own,
Let it go, let it go, let it go....

Fri, 12/27/2013 - 10:18 | 4278887 GrinandBearit
GrinandBearit's picture

The criminals will most likely knock it down again when they come back from banging their Hampton whores.

Fri, 12/27/2013 - 10:43 | 4278930 Bobbyrib
Bobbyrib's picture

Someone or something (THE FED) is already knocking down the rate to 3, and if it goes above 3 it is only for a few seconds.

Fri, 12/27/2013 - 12:28 | 4279188 Osmium
Osmium's picture

Ben must have fired up the presses again.  Last quote I saw was 2.99

Fri, 12/27/2013 - 11:36 | 4279015 Fix It Again Timmy
Fix It Again Timmy's picture

Rates on 'roids - What's poor Janet gonna do?  Shit in her pantaloonies?.....

Fri, 12/27/2013 - 11:52 | 4279057 firstdivision
firstdivision's picture

3.05 is the? Maginot Line

Fri, 12/27/2013 - 12:03 | 4279101 Obchelli
Obchelli's picture

it used to be 3.00% when it becomes 3.05% maginot line will be moved to 3.25% and so on... FED won I have to admit rise is very orderly

Fri, 12/27/2013 - 12:18 | 4279146 firstdivision
firstdivision's picture

Actually, the Fed is losing.  The Fed/US Govt wants low borrowing rates to continue.  Market is saying "fuck you" since the FRB is now the market.

Fri, 12/27/2013 - 12:20 | 4279153 Alethian
Alethian's picture

The crack will happen. The lesson is that pundits can't and shouldn't draw arbitrary lines in the numbers. 

Fri, 12/27/2013 - 12:28 | 4279183 wisehiney
wisehiney's picture

When they dispatch their minions to all media outlets to proclaim higher rates coming, you know that they will be lower very soon.

Fri, 12/27/2013 - 13:20 | 4279331 thefirstabomb
thefirstabomb's picture

Well good in that at least the smoke and mirrors will be over with soon

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