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Dow Drops 600 Points In 24 Hours As 30Y Yield Crashes To Record Low
US equity prices and US Treasury yields are tumbling after the disappointingly narrative-destroying retail sales data for 'gas tax cut'-based December. The Dow is now down almost 600 points from yesterday's highs At 2.39%, 30Y Yields have never been lower...ever! US stock indices are down 3% year-to-date, testing the lows of the year. Crude is rolling back over, gold is surging, and the USDollar is fading...
Dow is down almost 600 points in 24 hours...
Stock futures are tumbling...
30Y Treasury Yields have crashed to new all-time record lows... with a 2.39% handle
Crude is roiling back over...
and gold is surging...
Charts: Bloomberg
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Guess no one cares about "inflation" or the national debt anymore given how low long-term rates are.
Well the last time I looked the National Debt was not decreasing and once all of the one time gains from Capital gains diminishes with the crony Feds' pumping up of asset prices for the 1% then the deficits will sky rocket as well.
Vindi-fucking-cation!
It's time to get out until the Fed announces QE4.
And PM's catch a bid... Is it finally time?
There ain't gonna be a Fed soon so forget any QE ever again.
I love days like this. Burn baby burn!
Plenty of gaps down below that need filling and times like these are great opportunities
FLASH CRASH PLEASE
Oh yeah, they'll do something to Un-Vindi-fucking-cation me.
Just, I see the gold and bonds strategy as a long term solid core position.
Somewhere, someday, commodities will be a super-dooper bet with what's going on.
Nope, gas ain't gonna be priced at any $30 or and $120 for long. Just ain't gonna happen.
And...... There's been no rain in CA
Crops are in serious jeopardy for this year.
And yeah, the temporary is, behind the scenes as we speak, becoming panic
QE4infinity anybody?
Certainly QE4 or whatever the new or non-name will be. DJIA -crash that mother fucker to sub 6000!
Oh, and one more, for those who have money in a 401k. As you might know, the rules for Money Market funds are changing. Money Markets are the most common "cash" investement used in most 401k plans. Here's the best 1-paragraph explanation of the changes, in simple English, I've run across to date:
As the article explains in much more detail, for 401(k) purposes money market funds will fall into three categories: institutional, retail, and government. When these new rules are implemented, the shares of institutional money market funds will float in value. That is, the shares will no longer have a stated value of one dollar. (Of course, even under current rules the stated value of shares in a money market fund could drop below a value of one dollar per share [also known as “breaking the buck”]. But these cases were almost nonexistent. Under the new rules, the value of institutional shares will float daily.) Some people think that change will be upsetting to 401(k) participants, since they see money market funds as similar to savings accounts. Retail money market funds, on the other hand, will be able to continue to show their value as one dollar per share, but under certain circumstances (explained in the article), participants may not be able to liquidate the money market fund and withdraw money on short notice. Since a 401(k) plan’s money market fund is often used for short-term needs (such as a participant loan to buy a house or make other important purchases), that potential lack of access—even though short term—may not be acceptable to some participants and fiduciaries. That brings us to government funds. Government money market funds will be able to show their value as one dollar per share and will not be subject to any new gateways or liquidity restrictions. However, the interest on short-term government instruments is lower than on the commercial debt held by retail funds.
So, yes, things just got more complicated (and worse), thanks to our friends in government, who are here to help us.
Here's all you need to know to understand who bears the burden of risk:
Or...
Heads they win, tails they win.
You still need to generate liquidity though.
Sure...you can "liquidate" all the pension funds and leave all the old geezers in the lurch...still doesn't solve the problem of a collapse in the commercial paper market.
Talk about "rollover risk.". These FAR SMALLER TBTF Banks still are just sitting on a mountain of " inventory" (debt) waiting for a RECOVERY to appear.
Well....what about repayment risk you dopes!
Where is the INFLATION!!!!!!
QE4 was the Japanese pension grab, and an attempt to QE in Euro. Central bankers are cornered by BRICS and OPEC at this moment. If they try to print here openly, they expose themselves.
Next chess move is critical now.
When cornered - War is usually the next step
Don't be so sure. When people get desperate, they believe just about anything or anyone who makes empty promises of safety. But it will be more obvious for some, and so the divide between those who know and those who are willfully ignorant grows as does the probability of conflict between them.
here is a big ???? I remember the MSM selling retail holiday sales were up up up and I know many people bought the lies into STAWKS. the attorneys should be getting thier pencils sharp lies lies lies but hey my investments finally coming out of the cellar cue up the manipulators
for the time being. at some point it will catch up. presumably under the next president.
On the contrary, this is great news as it makes national debt more "affordable".
Just as they were touting "affordability" in regards to the housing markets a while back, nevermind that borrowers will eventually default when rates normalize.
Sucks being Japan doesn't it?
Your sandwich is coming into view Doc...
I wonder what people will think when the 10yr finally hits 1%?
Wow another chance to BTFD
BTFC .... "Collapse"
Also, bitcoin at $198 on steady downtrend.
Might be time to short this bitch... DOW down 600 today?
I have been trying to build a position in VIXY for about a week now but the sucker keeps going up. I got my toe in the water a hair under 20 hoping to dollar cost average over a week or so and be in the high teens. I'm in the "meh" now trying to figure out if i should book gains on a stupidly small position or wait it out lol.
Boy do u know how to jinx this thing
Bitcoin is bitcrap. Going to 0.
$0 ? Not likely.
No electricity - no bitcoin.
The problem with cryptos is the infinite supply of alternatives. If every day Western Union had to compete with an endless stream of upstarts like Northern Union, Southern Union, Eastern Union North by Northwest Union, etc. etc., their stock would probably tank also.
the problem is nobody cares
edit
well about 250.000 neckbeards care but don't actually use it because hodl and moon
the scale is just too damn tiny to matter
Fonestar/Ghoat-Rider/Anal-OG/bovine-reuptake-inhibitor cares. . .
Poor bastard is losing his shorts.
Ah, BTC.
"That's another fine (investment) mess you got us into, Ollie".
yesterday 10yr closed just below 190 in yield, breaking through critical resistance. Bond closed 3 bps off of all-time low yield.
today's news (suspected yesterday by bond market) pushed prices up, yields down. Technical analysis does not do well in all-time low yield territory - we could see much lower yields over the next month.
NOTE - today is a 30yr paper auction. IMHO, rates will rise this morning (until 1 pm and later) as primary dealers and big trading houses take positions to be gin trading the When Issued this afternoon and tomorrow. Rates will rise this morning and drop this afternoon.
NoVa
+ a whole bunch for knowing what the WI market is!
thanks - usually I'm a witty joker with comments, but I do know a thang or two.
Don't shoot me, but I'm in the mortgage business (finance not sales). I hope I don't get killed with down votes - it's my trade for over 25 years. Really guys - I'm on ZH side.
A few more years and I'm outta here for surfing every day in a warm climate.
NoVa
Living the dream.
So far this year, surfed 12 out of 14 days.
A swell cannot be bought, sold or leveraged and can only be dropped into if you are there.
Don't wait to long ;)
Dude, I am so jealous. Out of all of God's creation, ocean waves are the only natural phenomenom (sp) that man can interact, touch, feel & drop in on!
Microwaves, lightwaves, sound wave, particle waves, etc... nada
cya
The Ocean is my Church.
The Waves, his grace sent in my direction.
Nice to be on the same page with you!
Where rates wukk be going this AFTERNOOON ? Are you serious?
Who the fuck cares about this afternoon!
A few of us were here 12 months ago....yeah a YEAR ago....saying US Treasury rates would fall, when every "expert" on the Street said they were going from 3.0% to 3.5%+ by YE'14.
So a better question for you to answer is---where will rates be on 12/31/15 ?
you tell me forward inflation / delfation expectations on 12/31/15, and I'll tell you where the long end of treasuries will be.
professional traders (not me!) have the 10yr futures trading at 126'24 in price. That equates to approximately a 2.2% in yield in Dec 2015.
http://www.cmegroup.com/trading/interest-rates/us-treasury/10-year-us-tr...
IMHO, Fed will raise Fed funds rate 25 bps at a time, maybe to 50 by 12/31. Yield curve will continue to flatten, possibly go inverted starting at the 5yr T duration. The German 5yr bund is negative.
I trade for ST - not Invest for LT as required by pension funds and other long term investors in treasuries.
2015 will be a risk-off year, imo.
Good Luck.
I trade for the ST too. And this morning, I was selling a lot of what I bought over the last 6-12 months. As you can imagine, I am very happy with the results of this trade.
And while I've been pounding the table (including here on ZH) about rates falling over the past year (and the have), I am not convinced they will fall too much further, without some sort of bounce first.
But if US equities, IG and HY crash----following the crash in oil and copper----then 1.25% (a new cycle low) on the 10yr would be a realistic target.
concur - 125 has a chance to be reached.
off to work. cya
Which FED governor is going to be first to speak?
maybe someone can set up a bingo card for this, with names and times.
BullTard or Evans.
All of them plus some non voting members too.
Yesterday's news:
http://newsdaily.com/2015/01/feds-kocherlakota-backs-goal-based-policy-w...
BTFD
PMs are getting a little bump too....to me it seems the economy has just stopped.....we are in reverse mode now...except for GM..they dont seem to get it...ever...
To me it seems the economy has just stopped.....
The creation of "products of value" the true measure of economic activity has been crashing for many years.
The baltic dry index flatlined over a year ago and has not moved. No raw materials in the pipeline to be converted using labor and capital into products of value.
The bottom line is that without massive CB intervention to keep the illusion "alive"....
(Insert nightmare scenario of choice)
Time to line up some housing industry parrots on CNBS, "there's never been a better time to buy a home"
There was a middle aged gay guy on this morning talking about the "New Super Retail" or some such shit like that..... gay market. Gonna propel Tiffany (remember the bad sales and stock crash the other day? huh? like Tiffany placed Propaganda?) and the rest of the wealthy inclusive world to new and better grand fucking beautiful diversity and loving dream-lands of joy!
(I got a bunch of seriously gay friends (and I mean dear friends, close relationships)....none that are flamers... and I got no problem with gays, etc., but this shit of propagandizing everyone is getting weary... and no, I can't stand the flamers.... offputting)
The big bull market will be in nation wide law firms that specialize in gay divorce.
It's coming I tell you.
The most violently contested property, subject to equitable division, will be the wardrobe.
Is it tough going through life as an ignorant, bitter heterosexual? Or are you just repressing your true feelings?
Why dont you go bite your rainbow colored pillow?
Gay hate speech first.
Not necessary
Cramer's going full Bobcat Goldwait
now he's blaming bad retail data on not counting Iphone sales, ROFLMAO what a shyster/whore
Ah Hah! The iCrap Effect that Brought the Economy Down!
Its a Beauty!
https://www.tradingview.com/x/Mvgpwezf/
and....the ZH Effect begins for today.
The banks need the volitility in the markets so they can play their games....and they will gin it up to do so...HFT to the ready....tank it today...raise it tomorrow...its a trade a day market...
exactly. can you say.. CHURN little boy? I like the way you say that...
egg a muffin...
P < P + I
My compliments to your taste in avatars!
Bullard and Henry, get out of the toilets, you're needed urgently.
I'm sick and tired of you setting me up
Setting me up just to knock-a knock-a knock-a me down
Down, down, down
I'm going down, down, down, down...
[/bruce]
We are Gona need the 3:30 ramp up at the 9:30 open
IMHO, Equities Ramp job is coming from late morning to 1 pm. FUGLY sell-off into the the afternoon. Bonds - reverse price action.
NoVa
Told ya: Run like hell.
One of my golf buds from Oklahoma, when ya' hit a monster that rolls for a mile says "Run like ya stole sumptin'"
Knuks, he's gonna be pissed you outted him here on the Hedge...
Oh shit. I forgot, guys from OK aren't supposed to play golf.
Teee heee heh
The German 10yr is trying to catch Japan. It aint pretty across either pond.
UST is trying to catch the Bund, trying to catch the JGB.
... and everyone running in circles trying to pass their fiscal mistakes onto someone else
this merry-go-round is getting to be fucking pointless, adults simply aren't running the show anymore
nice downvote lol... pointless
Being un employed and been paying my debts with what savings I have left I should just say fuck it and stop paying my debts..
It's Free Swipe Yo EBT (Explicit Lyrics): https://www.youtube.com/watch?v=NzspsovNvII
Do it correctly. TRY and validate the debts. No reply? No debt.
Who's that knocking on my door
It's gotta be a quarter to four
Is it you again, coming 'round for MOAR...
[/Hot Legs]
You know Goldman is either short or trying to drive down prices to buy low - when they come out with an oil forecast on Monday saying $39, then as oil prices stabilize above $45, they come out again Wednesday and say that oil will be under $39. So what good is their Monday forecast?
Of course, TBTF banks can speculate all they want on oil prices - because the taxpayers have their back!
>>Goldman oil forecast on Monday saying $39
>>Wednesday and say that oil will be under $39
read between the lines here. You really want to believe GS free advice has no agenda??
dow drops 600 points and still at 17,300..........lmao
$2 gas mean average consumer has $30 more per week, just enough to pay for copper Obangocare plan.
Wait until you get charged for the ACA's Lead plan.
When you got nothing like CNBC: remind everyone how we're only 3 percent down from all-time high.
you don't get a bonus in 2015 by being down 3%
Wow! CNBC just pulled out green number from NRF on holiday sales. The desperation...
BULLISH,,,
Fukk it, buy everything today, tomorrow up 1000 pts.
The desperation of CNBC is unbearable to watch, ugh
I quit watching that tripe back in 2010, and I'm happier for it.
I turned it off years ago but on days like today if I can I turn it on in the back room and I heard Cramer come right out and say "this market isn't going to crash there is no systemic risk in this country." So we know what is on his mind.
He also said the market was just mentally ill and there was medication for mental illness.
If you have cable, you are putting money into CNBC's pockets whether you watch it or not.
Disconnecting one's Cable Tv (or satellite Tv) is the only way to shut those useless fuckers up.
My first thought was how close are we to Fantastic Friday? LOL.
BUY THE DIP!
with both thumbs
JSUABTFDYFI!
How long will it be before a Fed mouthpiece goes public to try and soothe the markets? Sell-offs are not allowed in the new normal.
FedFUBAR.
I'd LOVE to see a Fed spokesman get up there, and have the markets TANK as they are speaking...Have the biggest one-day loss in history as Yellen babbles about the economy...
And I'm waiting for the MSM to comment on how the market keeps going down during this wonderful Obama-recovery.
I notice they pretty much ignored the wage aspect of the recent jobs data...all I hear was cheering at "all the JOBS being created!"
Who says you can run but you can't hide?:
http://www.investing.com/rates-bonds/u.s.-30-year-bond-yield-advanced-chart
Crude is acting up: have Jane McCain and Victorious Nuland declared war somewhere?
http://www.investing.com/commodities/crude-oil-advanced-chart
Green by 4. The ZH irrational exuberance jinx.
The Federal Reserve is stuck at 0% rates and a declining economy (like the rest of the world).
This time QE will have to be $125 billion/month. Maybe $150 billion/month.
More and more QEs like Japan while debt explodes and personal spending decreases.
It sucks to be in declining feedback economy trying to support the too big to Fail.
Crude already green! Time for some reverse irrational exub (RIREX).
Did anyone share this yesterday? If not, now's a good time.
http://newsdaily.com/2015/01/feds-kocherlakota-backs-goal-based-policy-w...
My favorite part was this: "He does not vote on Fed policy this year, and has announced plans to resign by early next year."
I figured it was a trial balloon; see if it made news and affected markets.
Welcome to the machine.
Bank index BKX opening down 2% not a good sign:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=bkx&insttype=&freq=1&show=&time=5
Very Bullish!
Since August, the S&P has gone up about 7%.
Since August, the currency base has gone down about 9%.
Keep in mind, they were nearly perfectly correlated since the March 2009 low, up until August 2014.
This seems to point to a roughly 16% drop in the absence of any further QE, assuming the currency base doesn't drop from here (margin calls at that level of drop may create a vicious cycle, as banks pull their reserves to satisfy trading losses).
Look at the S&P500 log scaled from the 2009 stock market recovery start. The last round of QE pushed the market well above the recovery uptrend. It was done on purpose, as Bernanke said, to move employment improvement along faster. In other words, the Fed purposefully pushed asset prices up faster and further than they should be. Now that they are backing off for the time being, a 15-20% decline from here just gets you back to the uptrend before the QE spike. Whether it falls apart thereafter is anyone's guess, but I would expect that, true to form, they will not tolerate a 15-20% selloff and will start simulating again.
BTFD won't work this time around. The overall trend is down and will continue down for a long while to come. Some people saw this crash coming...
DOW
http://www.globaldeflationnews.com/dow-jones-industrial-averageelliott-w...
S&P 500
http://www.globaldeflationnews.com/sp-500-indexelliott-wave-update-for-w...
And the BDI is up the last two days. Go figure.
Is it just my imagination or are the "recovery" time intervals from these drops in stock market prices and the restorative rebounds- the time it takes the FED to muster enough purchase orders to rescusitate the market drops- is taking longer to achieve and the dead cat bounces less and less each time. Could this be a signal that the FED is getting very tired, and their pump can not keep up with all the leaks?
Could it be that the other central banks have depleted their reserves faster than the FED anticipated? If so, then hello QE4.
It was yesterday when I asked myself if the market seemed to be "melting up." It must have been, because today is most definately a melt-down. Holy smokes, negative-600?!?!?!
global liquidity trap
Short this market? The Fed has - Pavlov's Dog style - trained a considerable number of investors to lift this market by merely speaking a few words. When that crowd has lost its faith, maybe.