US Bank Stocks Surge To 2016 Highs Despite Collapse In Yield Curve To 9 Year Lows

Tyler Durden's picture

US bank stocks are exuberantly listening to mainstream media pushers as the hopes of a double-rate-hike-rainbow has sent S&P Financials to their highest since Dec 2015. However, despite the rise in implied rate-hike odds, the Treasury curve is utterly collapsing (which is what really matters for NIM) with 2s30s now at its lowest since 2007...



As we noted previously, the business models of pension plans, insurance companies, money managers are all affected by what happens to the yield curve, in different ways. But nobody like a Bank is so inescapably impacted by its shape.

At times, good Banks can skilfully outperform their core commodity – the yield curve - and smoothen its widest gyrations across the cycle. Like a good oil company can diversify and smoothen the violent swings of oil prices.

But can they totally disconnect from it? Unlikely.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Dr. Engali's picture

No worries. That rate increase is coming any day now...., now...., now........

0hedgehog's picture

The rate increase came in December and went kaboom in January! Next move will be back down, then down further. This party just got started.

Squid Viscous's picture

Dick Bove says step in with all 4 hooves

Squid Viscous's picture

Dick? i thought you were too busy lunching with the banksters, or having a schmear in the Hampsteins

RawPawg's picture

you keep fondling your fiat

i'll keeping fondling my little baby 1 oz'ers

KimAsa's picture

The FED may be actively engaged in a plan to consider the possibility of raising rates 10 basis points.

Kaiser Sousa's picture

"BUY, BUY, BUY!!!!"

fucking bullshit...



RadioFlyer's picture
RadioFlyer (not verified) Kaiser Sousa Aug 29, 2016 12:26 PM



CAT!  48 months of zip doodie. 


It'll get replaced soon.

King Tut's picture
King Tut (not verified) RadioFlyer Aug 29, 2016 3:06 PM

I can see why DE is doing so well- rapidly falling commodity prices mean farmers will be buying even moar $500K combines/s

FreeShitter's picture

Sold the mcmansion, the F250 and went all in. Fuck it.....nothing will go wrong.

LawsofPhysics's picture


Just like the "low inflation", someone is lying!!!

Roll the motherfucking guillotines, nothing changes otherwise...

< yawn > same as it ever was...

Cursive's picture

"No rate normalization in my lifetime."


LawsofPhysics's picture

"Once unemployment goes below 6.5 % we will begin to normalize rates" - Ben Bernanke in his Exit Strategy paper...

Who the fuck knows?  The only sure thing is that central bankers, financiers, and their political puppets lie....

Squid Viscous's picture

Cramer says BAC strong BUY BUY BUY cuz below "book value"

LOL!!!  i switched from comedy channel to CNBC in my car

Kaiser Sousa's picture



"what a maroon..."


falak pema's picture

Not good for the Duck...

theeseer's picture

With the USA set to get a new huge influx of Syrians from Hillary and "Black Lives Matter" set to be the new "Revolutionary Guard" like Iran we can surely expect a new and better America. Yes folks the banks have made a killing with fees galore and no accounting standards since "mark to model" replaced "mark to market". Why not put money into the market because who exactly is going to stop this insanity? 20 trillion in debt? No problem Why not 30 trillion? Just give the 11 million illegals the vote now and insure the prosperity that only a one party Democratic party socialist country can guarantee. Hey why not get Maduro from Venezuela to give us lessons, he not only bankrupted the country he just arrested the opposition leader. Tyler should be making travel plans they will be coming for him soon.

south40_dreams's picture

Big prosperity quarter