When is this bubble going to burst?

We’ve previously discussed the bubble in US Treasuries, but it just seems to keep growing. When is it going to end is anyone’s guess, but we do know that The Fed has a seriously large position in US Treasuries, some say larger than China’s.

For comparison purposes, foreign holders of US Treasury debt [...]

Spread between US 10Y and German 10Y suddenly widens …

The market seems to be forecasting increased fiscal integration which is, of course, just about the only way out of the Eurozone mess. In the short term probably not the best option for Germany but it works for everyone else.

What goes up must go down.

The chart above show the yield on what is known as a constant maturity treasury; effectively we’re graphing the yield on the 10Y Treasury over time.

You’ll note the aberration – from the early 80s, or for roughly thirty years, yields have been moving in one direction – DOWN. This can’t continue forever [...]

European Bailout Fund Could ‘One Day’ Issue Bonds in Yuan, Regling Says – Bloomberg

Ok, issuing bonds in Yuan is one thing, most multinational corporations already issue in foreign currencies but including the Yuan in SDRs is something completely different. Besides, folks are getting tired of bailouts …

Bonds Beating U.S. Stocks Over 30 Years for First Time Since 19th Century

An interesting article but a little misleading – they’re talking about gains in bonds that you’d only realise if you were actively trading the securities. If you’re a buy and hold investor (not a trader) lots of these same bonds are priced at a premium. I’m still buying shares myself and will continue to [...]