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Flight To Safety Sends 2Y German Yields To Record Low, -10bps!

Tyler Durden's picture




 

As Greek headlines start to sink in, and hot on the heels of Japan recently issuing 2Y bonds at a negative yield for the first time ever, German 2Y yields have crashed to new record lows at -10bps... So what exactly will ECB QE do?

 

 

Charts: Bloomberg

 

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Mon, 12/29/2014 - 10:18 | 5601276 SheepDog-One
SheepDog-One's picture

I'll gladly lose money just to park it with you for a while please!

Mon, 12/29/2014 - 10:35 | 5601327 Manthong
Manthong's picture

So what exactly will ECB QE do? 

Because it’s serious, whatever it takes with lies and a bazooka except for repatriating or buying gold like the Dutch, Chinese, Russians, Indians and others not deluded by the deception of western central banking.

Mon, 12/29/2014 - 10:37 | 5601338 rccalhoun
rccalhoun's picture

qe will raise asset prices--equities, housing, art, etc

am i answereing a trick question?

 

Mon, 12/29/2014 - 10:43 | 5601349 max2205
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Buy a new mattress 

Mon, 12/29/2014 - 11:17 | 5601460 Stackers
Stackers's picture

So what exactly will ECB QE do?

It will free up bank balance sheets and lower consumer loan rates so those banks can not make loans to the same unemployed over indebted people in can not make loans to now

Mon, 12/29/2014 - 11:35 | 5601501 Crazy Canuck
Crazy Canuck's picture

But those nice young men in those 5k suits were being so reasonable when they told me that they would only charge me a small amount to guard my money.

Good deal, no?

Mon, 12/29/2014 - 10:21 | 5601279 Kaiser Sousa
Kaiser Sousa's picture

die u MoneyChanger fucks....
DIE!

Mon, 12/29/2014 - 10:24 | 5601286 Latitude25
Latitude25's picture

Buy physical gold.  Looking better and better every day.

Mon, 12/29/2014 - 10:34 | 5601321 Kaiser Sousa
Kaiser Sousa's picture

expect the phony paper prices of both of the only 2 forms of REAL money to come under attack all day....

Mon, 12/29/2014 - 10:48 | 5601375 Latitude25
Latitude25's picture

Good call.  Getting stomped on right now.  Buy at the year end bottom.  It's so predictable.

Mon, 12/29/2014 - 10:55 | 5601388 Kaiser Sousa
Kaiser Sousa's picture

predictable...
pathetic...
and desperate...

Mon, 12/29/2014 - 12:45 | 5601684 The Merovingian
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I do wish they would stomp a little harder (selfishly speaking) .... so I could buy MOAR physical!!   

Mon, 12/29/2014 - 10:24 | 5601287 ejmoosa
ejmoosa's picture

At what point does safety begin to feel like extortion from those that owe the money on these bonds?

Mon, 12/29/2014 - 10:27 | 5601302 Soul Glow
Soul Glow's picture

When China dumps the rest of their USTs.

Mon, 12/29/2014 - 10:27 | 5601297 i_call_you_my_base
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What will QE do? Send rates deep into negative territory I guess.

Mon, 12/29/2014 - 10:26 | 5601299 Soul Glow
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When Tyler asked "What happens next" with Greek bonds I should have said flight to bunds.

Mon, 12/29/2014 - 10:28 | 5601306 youngman
youngman's picture

Better than a flight to Indonesia right now.....

Mon, 12/29/2014 - 10:30 | 5601307 SickDollar
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the Greeks and Germany need to come out of this EU for their own sake

FUCk the TRIBE and their Monetary system, besides it is coming to an end this debt game crap

show me one tribe member who is poor in this world

 

Mon, 12/29/2014 - 10:32 | 5601318 e_u_r_o
e_u_r_o's picture

how can someone possibly be this stupid to pay interest instead of buying gold? explain to me

Mon, 12/29/2014 - 10:59 | 5601402 tarsubil
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Simple, the plan is to sell to someone else at a more negative rate. If this isn't a full frontal ponzi, I don't know what is.

Mon, 12/29/2014 - 11:05 | 5601423 Seasmoke
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Oh...you mean like buying a house for $750,000 (really worth $100,000) and planning on find someone else to sell it to for $1 million. 

Mon, 12/29/2014 - 11:23 | 5601473 tarsubil
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You know since prices never go down, that sounds like a sound investment strategy for getting rich quick.

Mon, 12/29/2014 - 12:48 | 5601697 HowdyDoody
HowdyDoody's picture

Wait until gold ETFs go negative!

Mon, 12/29/2014 - 11:10 | 5601442 Debugas
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because gold is going down faster than -0.10% you pay to hold bunds

Mon, 12/29/2014 - 14:52 | 5602096 Overfed
Overfed's picture

Not forever.

Mon, 12/29/2014 - 11:48 | 5601531 Pig Circus
Pig Circus's picture

how can someone possibly be this stupid to pay interest instead of buying gold? explain to me

But Gold doesn't pay a Divi use to be the arguement.

Mon, 12/29/2014 - 11:54 | 5601547 Pig Circus
Pig Circus's picture

I suspect if rate go more negative Governments will add to deficits as they reimburse tax losses to investors. We talk about deficits rising when/if rates go higher how about lower?

Mon, 12/29/2014 - 10:42 | 5601348 alexmark2013
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Think about how high Greek bond yields would be if 75.2% of the entire debt outstanding wasn't "non-tradable":  http://investmentwatchblog.com/think-about-how-high-greek-bond-yields-would-be-if-75-2-of-the-entire-debt-outstanding-wasnt-non-tradable/
Mon, 12/29/2014 - 10:56 | 5601396 tarsubil
tarsubil's picture

Can you imagine buying a government bond with a minimal positive yield and then selling it to someone else at a price where the yield is negative? What am I saying? People bought government bonds at negative yield and made money by selling them at more negative rates! Unbelievable right? Incredible right?

Don't worry everyone, everything is bone.

Mon, 12/29/2014 - 10:57 | 5601400 youngman
youngman's picture

and now the takedown in gold and silver....yeah thats it....buy a bund and pay to own it..or buy gold and silver....

Mon, 12/29/2014 - 10:57 | 5601401 numapepi
numapepi's picture

Imagine what a poor investment a negative 1% return is... moreover how atrocious it will be when inflation kicks in.

Piling cash under the mattress is looking better and better.

Mon, 12/29/2014 - 11:03 | 5601407 buzzsaw99
buzzsaw99's picture

So what exactly will ECB QE do?

trick question? rates go to negative infinity, just like amzn's p/e.

Mon, 12/29/2014 - 11:52 | 5601543 kaiserhoff
kaiserhoff's picture

I don't like that answer, buzz.

Too much truthiness.

Mon, 12/29/2014 - 11:18 | 5601462 kowalli
kowalli's picture

it's insane madness

Mon, 12/29/2014 - 11:32 | 5601488 Ewtman
Ewtman's picture

Exactly the opposite will happen to US Treasuries. The 10 Year yield, for example, is about to launch upward in a move that will probably surprise almost everyone...

 

http://www.globaldeflationnews.com/10-year-u-s-treasury-index-yieldellio...

Mon, 12/29/2014 - 11:37 | 5601503 Colonel Klink
Colonel Klink's picture

Germany once again being raped and pillaged by the moneychangers again.

Mon, 12/29/2014 - 11:42 | 5601516 jubber
jubber's picture

and if by magic the Dax bounces from 9773 to back over 9900

Mon, 12/29/2014 - 12:15 | 5601601 DebtTheNewEquity
DebtTheNewEquity's picture

THERE IS NO SUCH THING AS CASH. 

 

Only higher and lower grades of debt.

Mon, 12/29/2014 - 13:17 | 5601779 mendigo
mendigo's picture

Two words that fairly summarize the state of afairs under our nwo masters: Punishment Interest. Pure genious!

Mon, 12/29/2014 - 13:30 | 5601818 numapepi
numapepi's picture

Upon reflection, If the interest rate on a bund is less than zero... what does that say about the opportunity cost of money today versus tomorrow?

A less than zero bund rate, is the market telling us that the economic conditions today are so bad, there is essentially less than zero opportunity to create wealth. Moreover, as rates continue to slide doesn't that suggests tomorrows opportunity to create wealth will drop as well?

That could be from a structural problem like high taxes, heavy regulations or Obama care corroding the labor economy with disincentives, or cyclical as in a short term recession to shake the low efficiency producers out of the economy.

I would say the lack of opportunity is a structural problem. Regulations have never been higher in the US and elsewhere. Regulations grow, they never retreat, thus at any given time it could be said that regulations have never been higher. We all know that the mode of growth of any economy, are small businesses, which are hardest hit by regulations.

Furthermore, if the lack of opportunity was a cyclical problem, we would see layoffs as inefficient firms lay off and we are not seeing that either.

So what I am getting at, is the economic conditions the political elite have set up are terrible and getting worse. Unless a change is made in their predilection to regulate every facet of human activity, then tax it, our situation bad as it is will probably get worse, as the burdens to small business continue to pile up.

Mon, 12/29/2014 - 23:15 | 5603922 Quaderratic Probing
Quaderratic Probing's picture

And when you say deflation is coming no one listens, or rather the economic slow down is part of the masterplan to manipulate gold down becomes the thread.

Too much debt, no growth, no wage increases forget inflation its not the problem.

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