GDP 'Good News' Sparks Bond Buying & Stock Selling, Treasury Curve Crumbles Further

Tyler Durden's picture

US GDP beat expectations 'proving' that government data shows the recovery meme is on track (as long as it doesn't snow ever again). The market's reaction... intriguing - stocks shrugged even as a USDJPY pump tried to get things going; gold and silver moved modestly higher; and Treasury yields... fell notably at the long end. 30Y is now trading with a 3.06% handle and 5s30s is back below 145bps...!

Bonds are rallying on the GDP beat...


The yield curve continues to collapse...


And stocks are shrugging..


Chjarts: Bloomberg

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digitlman's picture

Chjarts are the bestest!

GetZeeGold's picture



It's cool cause you can make them show almost anything.


When the statues of limitations run out.....remind me to tell you a funny story.

Xibalba's picture

Always amused to see charts of rigged markets. 

Doubleguns's picture

Like showing off counterfeit art. 

WarHorse's picture

Oh look.  We're starting to rally.  HOw does this work again ... Bad news = mkt higher,  Good news = mkt higher .... I'm just happy we aren't in a bubble

buzzsaw99's picture

the 30y calls bullshit on the entire recovery meme. this would be a good time for the fed to unload some of the crap mbs on their books since things are so great. /s

RattNRoll's picture

Gold got a woody this morning!

Bossman1967's picture

give it a minute and we see headlines stocks pump gold dumps on this killer recovery. common Putin show Obama what a real set looks like

GetZeeGold's picture



I'll give you 60 seconds.....and no more.

Dr. Engali's picture

Oooopppps, that's not supposed to happen.

29.5 hours's picture



Another thing not supposed to be happening, the dollar giving a Galt shrug...the NYTimes printing an opinion against the dollar as reserve currency.

Dethrone ‘King Dollar’
Devotional's picture

any dip in the stock market is always bought. 

October 2014 stock market peak? 


taketheredpill's picture



Once upon a time the Yield Curve led the Economy.


Now the Economy is leading the Yield Curve.



dontgoforit's picture

Inevitable results of inscrutable actions.

himaroid's picture

Massive tbond short capitulation coming soon.

LawsofPhysics's picture

Many have been saying this since the mid 90's.  Good luck with that.  We might get haircuts and "bail-ins" but no one will be allowed to profit from those moves.

Seasmoke's picture

It seems they are truly trapped, with no more ways out.

monopoly's picture

I don't know about you guys but this constant melt up in bonds really has me concerned. There is no reason why so many are moving into the safety of bonds and treasuries. So, there must be a reason and we will probably get some insight next week after the holiday. These yields are absurd and yet they keep going lower and lower. There is a big black hole out there somewhere, I just cannot see it......yet.

LawsofPhysics's picture

There is a reason, specifically, the liabilities on the balance sheet of those governments, period.

Now shut the fuck up and pass the cheese...

LawsofPhysics's picture

...because "rates are going up"...



madbraz's picture

You should show that 5s30s chart since 1970 to give some perspective of where it should be.

NoDebt's picture

You guys better be buying 30 year TSYs before 3% is refferred to as "high yield" in a few years.

LawsofPhysics's picture

with negative rates in some areas of the western world already, 3% is in fact alread referred to as "high yeild".

especially if you have a couple billion (nothing by today's standards) earning 3%

buzzsaw99's picture

that's what many people still don't get. they think they missed the rally already.

disabledvet's picture

Actually most have missed the rally...well, actually moves like this are far more than just a rally. These are huge capital gains and if US rates start heading down towards German levels the returns on that debt would far outweigh anything in the equity space the last year or so.

NoDebt's picture

The rally in bonds started around 1982.  So, yeah, if you invest today, you proably already missed about half of it.

LawsofPhysics's picture

I don't think I would be so bold as to predict that endpoint.  It took rome over 500 years to destroy itself. 

NoDebt's picture

Things move a lot faster in modern times.  I think we can accomplish that feat in well under 100.

TVP's picture

The Luciferian plan set into motion on Jekyll Island in 1913 was intended to be a century-long undoing of America.  They are already a solid eighteen months behind schedule.  

These assholes never planned on the masses waking up and screwing all of their plans eight ways to sunday.  

Keep fighting the good fight, ZH posters and readers...we are winning.

loub215's picture



LawsofPhysics's picture

damn, we do have plenty of room to move...

RiskyBidness's picture

BTFD!!  Folks.........Do not think for a moment that this thing wont be bought!!

Keltner Channel Surf's picture

Duke Ellington, if alive, would be forced to modify his standard:  "I Got it Bad, and That Ain't Good --- er, Or Is It?"

ejmoosa's picture

Corporate profits AFTER taxes are now down 3.23% for the last four quaters ending 2nd quarter 2014.  

Whaterver magic they did to the GDP calculation, they failed to do to profits...

Businesses will not expand or continue hiring....look for the sharp adjustments after September 2014, when businesses start to put together their 2015 budgets.


Ness.'s picture

Don't fret kiddies.  We'll be green before noon.  

SheepDog-One's picture

It's OK, it's only Thursday and S&P is only down -3 so by Friday close they'll easily prop another all time high close I'm sure, it's vital for the ongoing shitshow to keep the general population in a drugged stupor of imaginary good times.

ChanceIs's picture

It's amazing how many people deny or are unaware of the correlation between the yield curve inverting and stocks collapsing. That 30 - 5 curve only goes back to '08.  Check out the "Dynamic Yield Curve" from Big Charts (I am not spamming):

It features the yield curve and S&P next to each other.  You start it playing (animate) and from '00 to today you can see the slope and what the S&P is doing.  See it go negative (slopewise) in late '00.  Oooooops.  What happened then?  Got  Then see it getting negative in late '06.  Danger! Danger Will Robinson!!!!

But '06 was eons ago in Wall Street time and the cocaine addled brains of the new grads coming in to fill the ranks.  Hey!!!  It's different this time.  One of those pukes said back it '00 - 'We have moved beyond interest rates.'

But a caveat.  The Bernanke and Yellen have so distorted things that even the yield curve might have lost its potency as a forecaster.  That if nothing else indicates the INSANITY of QE.

Memo to Ben/Janet:  Corporate managers need price signals to know when and where to invest.  How does what you are doing fit in with full employment and stable prices?  Do you interact with old people who can't get squat on their CDs anymore?  Are you going to invite them in to sleep on your floor when their stocks collapse?  No?  I didn't think so.  Now go crawl back into your holes and try not to make things any worse.

PS:  I never bought into that Keynesian meme that the Fed had any control over employment.  Thought it was BS from the day I first became acquainted with it.