Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Monday, February 07, 2011
Global Credit Crisis Contagion On the Verge Again / Interest-Rates / Credit Crisis 2011
By: Captain_Hook
Apparent disparities and idiosyncrasies between Western economies and China (at center of the emerging market model) continue to grow more profound, which will eventually end badly by popping the larger global credit bubble for good this time. This is of course not to say that our ambitious and greedy bankers and their crony politicians will disappear overnight, however if the serial bubbles in stocks, bonds, and anything that moves are popped, they will definitely have a great deal less currency to work with moving forward.
Monday, February 07, 2011
Bond Market, The Most Dangerous Bubble of All / Interest-Rates / International Bond Market
By: Martin_D_Weiss
If you agree that the tech bubble of the 1990s and the housing bubble of the 2000s were extreme, then you must not ignore a bubble that could be the most dangerous of all — grossly overvalued bonds.
That’s precisely the bubble we have right now! And in just a moment, I’ll tell you why it’s going to bust. But first, consider …
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Friday, February 04, 2011
Junk Bonds Sending a Warning Signal to Stock Market / Interest-Rates / International Bond Market
By: Money_Morning
Shah Gilani writes:
Junk bonds got issued at record rates in 2009 and again in 2010. And that pace has carried over into the New Year.
While the ability to raise money in the less-than-investment- grade bond market indicates that the market is getting back to where it used to be, there are reasons to be worried.
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Friday, February 04, 2011
Bernanke Reiterates January FOMC Policy Statement and Defends Fed’s Unconventional Monetary Policy / Interest-Rates / US Interest Rates
By: Asha_Bangalore
Chairman Bernanke reiterated the main thrust of the January FOMC policy statement for the most part today. In addition, he defended the large-scale asset purchases that the Fed has undertaken. His remarks also included the fiscal policy challenges the nation currently faces.
Thursday, February 03, 2011
Bond Markets Delayed Reaction to Inflation, A Moment of Clarity / Interest-Rates / International Bond Market
By: Adrian_Ash
Is the bond market finally catching on to the "forced risk" trade...?
AS NIALL FERGUSON never tires of reminding us, bond markets rarely react early to bad news, no matter how plain it looks to everyone else.
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Tuesday, February 01, 2011
Moodys Warns U.S. May Get Credit Rating Downgrade / Interest-Rates / Credit Crisis 2011
By: Money_Morning
Don Miller writes: The United States' AAA credit rating may be at risk sooner than previously thought as the nation fails to deal with its growing debt, Moody's Investors Service warned last week.
Moody's said December's extension of the Bush-era tax cuts, combined with results from the November elections, may lead to further gridlock in Congress, increasing its doubts about the federal government's determination to reduce its debt.
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Tuesday, February 01, 2011
U.S. Bond Prices Being Driven by Good News for a Change / Interest-Rates / US Bonds
By: John_Handbury
Treasury Bond prices usually flourish during bad times. Joblessness, recessions, lack of spending, usually drive bond prices up because a stagnating economy usually means lower interest rates and disinflation. These times are different however. Over the last few months we have seen a large drawdown in bond prices without a whiff of inflation. Why aren’t bond prices higher?
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Monday, January 31, 2011
Quantitative Easing is Nothing New / Interest-Rates / Quantitative Easing
By: Mike_Hewitt
The term 'quantitative easing' is just the newest term to describe the on-going central bank policy of increasing money supply.
Greetings. There has been an increasing amount of news covering the activities of The US Federal Reserve and other central banks. The newest expression being bantered about is "quantitative easing".
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Saturday, January 29, 2011
U.S. Bond Markets Deflation Whispers / Interest-Rates / Deflation
By: Brian_Bloom
In an inflationary environment, the longer dated yields should be in a bull trend relative to the shorter dated yields – because the time value of money rises in periods of inflation. Conversely, when there is deflation then money in the future is worth less than cash in the hand. Therefore the ratio should fall if deflation is being anticipated.
Saturday, January 29, 2011
Debt and Deficits, “The New Humpty Dumpty” / Interest-Rates / US Debt
By: Andy_Sutton
Irony is a wonderful thing sometimes. It has a habit of framing things exactly the way they need to be framed. Unfortunately, this is a knife that cuts both ways and irony sometimes points out awful realities. I am not a political animal per se, but I find it incredibly ironic how the avalanche of bad news on the deficit, Social Security, and essentially most of the things wrong with our economy was saved until after Tuesday’s SOTU speech. Make no mistake, this has happened before, and each time I find the timing to be absolutely incredible. It is very clear at least at this point that our leaders prefer to pay lip service to the idea of reducing the deficit rather than actually trying to rectify the situation. I say this because, with very few exceptions, the rhetoric centers around a silver bullet solution that will allow programs and spending to remain pretty much on the same path as what got us here, but at the same time, ‘fixing’ things.
Friday, January 28, 2011
Rate Hike Rumblings Increasing in the Interest Rate Market / Interest-Rates / International Bond Market
By: Mike_Larson
Psst! I have a secret for you. Central bankers in developed markets may actually start raising interest rates some day!
Shocker, I know! But if you follow the latest market moves — and listen to some of the chatter coming out of places like Europe — that’s the inevitable conclusion you arrive at.
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Friday, January 28, 2011
No respite for German Bunds / Interest-Rates / US Bonds
By: Seven_Days_Ahead
The safe haven days of the Bund are clearly in the past. After the frenetic buying that peaked in August, the Bund has been on a clear trend lower and it hasn’t been alone.
But given the Eurozone sovereign debt crisis still remains a live issue, and it was that very crisis that sent the Bund and other Bond markets soaring on safe haven trading, what has changed?
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Friday, January 28, 2011
S&P Slashes Japan's Credit Rating / Interest-Rates / Japanese Interest Rates
By: Money_Morning
Don Miller writes:
Standard & Poor's yesterday (Thursday) reduced Japan's long-term sovereign debt rating for the first time in nine years, saying Tokyo lacked a plan to deal with its mounting debt and persistent deflation.
The agency cut Japan's rating by one notch to AA minus, the fourth-highest level, citing the country's political gridlock for undermining efforts to reduce an $11 trillion (943 trillion yen) debt burden.
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Thursday, January 27, 2011
What Most People Don't Realize About The Fed's Superpowers / Interest-Rates / Central Banks
By: EWI
Since its creation in 1913, the primary intended role of the U.S. Federal Reserve Bank has been that of protector. In theory, the central bank was bestowed with the power to shape monetary policy in a way that would keep both booms and busts in check. The two main tools at its disposal -- interest rates and money creation -- would provide a "ceiling of normalcy" above expansions AND a "net of safety" below contractions.
Thursday, January 27, 2011
Should Congress Raise the U.S. Debt Ceiling? / Interest-Rates / US Debt
By: Robert_Murphy
At current rates of spending, the federal government may bump up against its debt limit as early as March. Treasury Secretary Timothy Geithner warns that it will be "catastrophic to the economy" if Congress doesn't increase Uncle Sam's credit limit. Writers in conservative outlets call for Republicans to use this opportunity to extract significant spending cuts before extending the limit. And some extreme libertarians argue that the debt ceiling shouldn't be raised, because a government default would be a good thing for the American people.
Thursday, January 27, 2011
U.S. Federal Budget Deficit Climbing Dangerously Higher on Continued 2011 Government Spending / Interest-Rates / US Debt
By: Money_Morning
Kerri Shannon writes:
On the heels of U.S. President Barack Obama's State of the Union address - during which the commander in chief highlighted the need for investment in innovation - a steep federal budget deficit projection yesterday (Wednesday) showed the harsh reality of the U.S. government's spending spree.
Thursday, January 27, 2011
FOMC Policy Statement - Status Quo is Also Noteworthy / Interest-Rates / US Interest Rates
By: Asha_Bangalore
The federal funds rate was left unchanged at 0%-0.25% as expected; it has held at this level since December 2008. The Fed's plan to purchase $600 billion of Treasury securities has also been left in place along with the existing arrangement of reinvesting principal payments from its holdings of securities. The vote was unanimous although four members of the voting panel were replaced for 2011. Charles Plosser of the Federal Reserve Bank of Philadelphia, Richard Fisher of the Dallas Fed, Charles Evans of the Chicago Fed and Narayana Kocherlakota of the Minneapolis Fed are the replacements. Of these four voting members, Fisher and Plosser have been critics about the second round of quantitative easing that is currently underway. They have held the opinion that the current stance of monetary accommodation carries with it inflationary consequences that would be damaging to the economy. However, unlike President Hoenig of the Kansas Fed who shared this opinion and dissented at each meeting in 2010, these two members voted along with majority in today's meeting.
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Monday, January 24, 2011
The Great Global Debt Shift / Interest-Rates / Global Debt Crisis
By: John_Browne
If one were asked to describe the major global economic changes that have unfolded since the financial crisis began, a good starting place would be the massive shift of debt from the private to the public sector. Attempting to arrest a deepening crisis, governments all around the world have bailed out businesses and companies by transferring bad debts to the public books. Although these moves have provided some current stability (after all, governments are much less likely to default), the long-term consequences may be dire.
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Monday, January 24, 2011
Bernanke's Golden Dismount / Interest-Rates / US Interest Rates
By: Michael_Pento
There can be little doubt that Fed Chairman Benjamin Bernanke has been a very, very good friend to gold investors. However, some of those who have benefited from his largesse now fear that the recent selloff in gold indicates an imminent end to Bernanke's monetary high-wire act. Most assume that a cessation of the Fed's stimulative efforts, if it were to occur, would spell the end of gold's bull run. But a closer reading of Bernanke's economic philosophy and the Fed's own recent history, shows that once central banker begins a strenuous routine starts, it is very hard, if not impossible, for them to dismount.Read full article... Read full article...
Monday, January 24, 2011
Fed Accounting Rule Changes to Mask Losses / Interest-Rates / Central Banks
By: Mike_Shedlock
Many people have taken notice of changes slipped into the Fed's balance sheet reporting rules that will allegedly shield the Fed from devastating losses. Please consider Accounting Tweak Could Save Fed From Losses.