Treasuries fell, with the gap in yields between 2- and 30-year securities reaching the widest margin since at least 1980, after a $13 billion offering of 30- year bonds drew lower-than-forecast demand.
The so-called yield curve touched 373 basis points, the most in at least 29 years, as the bonds drew a yield of 4.52 percent, compared with an average forecast of 4.483 percent in a Bloomberg News survey of five of the Federal Reserve’s 18 primary dealers. The so-called yield curve has widened from 191 basis points at the end of 2008, with the Fed anchoring its target rate at a record-low range of zero to 0.25 percent and the Treasury extending the average maturity of U.S. debt. --Bloomberg
ObamaDollars can be used if and only if you have large baskets with which to carry them...
So we've now increased the supply of Treasury bonds held by the public by $2.5 trillion since the crisis began and the 30 year yield stands at a WHOPPING 4.5%. What are we gonna do?
ReplyDeleteGosh....we haven't seen that kind of yield since....the middle of 2008.
dadster. People buy the 30 year. They buy them everyday. Despite what the "ghosts of Carter past" tell you, the government is still financing operations with long term debt, locked in at a reasonable yield of 4.5%.
Yield CURVE, Struppster...
ReplyDelete..and I focused on the long end of the curve. The short end is even better for uncle sam.
ReplyDeleteThe disparity between short- and long-term rates is significant.
ReplyDeleteThe forecast is for inflation, and the Fed's artificial short-term rate game is irrelevant.
And as you know, bond yields change over time, struppster. They can go up, and the bet is that they WILL.
".....bond yields change over time, struppster. They can go up, and the bet is that they WILL."
ReplyDeleteThis is a GOOD thing Dadster!
Oh, really, Stupp?
ReplyDeletehttp://market-ticker.denninger.net/archives/1730-TIC-Data-Confirms-Foreign-Appetite-Gone.html
6% long-bond will make the 5% mortgage into history AND pressure Fed revenues, to say the least.