Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Thursday, June 25, 2015
When a Bond Is Not a Bond / Interest-Rates / International Bond Market
By: John_Mauldin
By Jared Dillian
I don’t know anything about Greece. I actually make it a point not to.
What I’ve found over the course of my career is that the closer people get to an issue, the worse their predictive power is. The forest-for-the-trees phenomenon. Like all the economists who do nothing but watch the Fed, every piece of data, every speech. Their track record in predicting interest rate moves is worse than everyone else’s!
Read full article... Read full article...
Thursday, June 25, 2015
When Will US Debt Hit the Wall? / Interest-Rates / US Debt
By: DeviantInvestor
As I see it, the following are true:
- Debt is increasing far more rapidly than growth in the underlying economies that must support that debt. Although this is also true in Japan, the UK, and Europe, I’ll focus on the US.
- Revenue is increasing but less rapidly than debt. This is a problem.
- There will come a time when the interest payments on exponentially increasing government debt will exceed what the economy can support. Call that point “hitting the wall.”
- Higher interest rates will cause the US economy to “hit the wall” sooner. Lower interest rates merely delay the “day of reckoning.”
Thursday, June 25, 2015
European Empire Strikes Back Against Greek Debt Fantasy, Counting Down to GREXIT / Interest-Rates / Eurozone Debt Crisis
By: Nadeem_Walayat
Greece has managed to survive Monday, Tuesday and Wednesday's bank runs that continue on a DAILY basis courtesy of the Euro-zone tax payer forced to step in as the ECB is provides the Greek banks with daily liquidity that totals every single Euro that is being withdrawn from the Greek banks by fearful depositors as Greece continues to count down to debt default on 30th of June. The question is will Greece survive Thursday? Friday? and off course the 30th of June deadline?
Tuesday, June 23, 2015
Long Term Interest Rates Are On The Up…What’s Next? / Interest-Rates / US Interest Rates
By: Harry_Dent
The Fed has delayed a rate hike yet again. It seems convinced the economy isn’t ready to survive on higher short-term rates. So we continue to see zero rates to stimulate more economic activity. But today the market is proving just how limited the Fed’s influence really is!I’ve been warning for years now that there is a limit to how much you can stimulate the economy with free money and zero interest rate policies before the financial drugs no longer work. Eventually, the system breaks down from excessive debt and overexpansion.
Read full article... Read full article...
Tuesday, June 23, 2015
The Greek Debt Crisis Investor Opportunity That's Being Missed / Interest-Rates / Eurozone Debt Crisis
By: ...
MoneyMorning.com Peter Krauth writes: As Greece approaches its next payment deadline, the rhetoric and the stakes are boiling over.
The IMF recently quit negotiations in Brussels, saying it had reached a stalemate.
Then Greek Prime Minister Tsipras said the IMF had "criminal responsibility" for his country's debt crisis.
Read full article... Read full article...
Monday, June 22, 2015
Interest Rates Are Rising for All the Wrong Reasons / Interest-Rates / US Interest Rates
By: Michael_Pento
Wall Street carnival barkers are relishing in the fantasy that the economy has finally achieved escape velocity. Therefore, they accept with alacrity that this is the primary reason why interest rates have started to rise. However, the fact still remains for the first half of 2015 GDP growth will probably be less than 1%.
Saturday, June 20, 2015
The Final Phase Of The U.S. Treasury Bond Market Bubble / Interest-Rates / US Bonds
By: Austin_Galt
There has been quite a bit of chatter in recent times about the bond bubble bursting. So, have we seen the final high in bond prices or final low in interest rates? No, I don’t believe so but we are indeed approaching the final phase of this bond bubble.
Let’s try to nail down the end of this bull market in bond prices and bear market in bond yields or interest rates by analysing in detail the charts of the 30yr US T-Bond prices and yields. We’ll begin with the big picture yearly chart of bond prices.
Saturday, June 20, 2015
The Simplest Way to View the U.S. Bond Market / Interest-Rates / US Bonds
By: DailyWealth
Dr. David Eifrig writes: It has been a wild time for fixed-income investments over the last couple years...
Interest rates are historically low in the U.S. In Europe, rates have spent time in negative territory... meaning investors were willing to take a guaranteed loss.
It can be hard to get a handle on what's happening today in the bond market... never mind where things may be headed tomorrow.
Read full article... Read full article...
Friday, June 19, 2015
US. Bonds and Banks / Interest-Rates / US Bonds
By: Alasdair_Macleod
This year has seen some big losses develop in the bond markets, though prices have stabilised in recent days. The chart above is of the yield on the lowest investment risk in ten year maturities. Most other 10-year bonds have seen even sharper rises in yield (i.e. greater price falls). This matters because the banking system is heavily invested in sovereign bonds, not only in the short end of the market where it traditionally invests its liquidity, but also in longer maturities between five and ten years. Furthermore, central banks have become exposed to the same risk through their bond purchases with implications for currency stability, but that is a separate issue.
Read full article... Read full article...
Friday, June 19, 2015
Big Fat Greek Bank Run - Greece Banking System Could Collapse Monday 22nd June / Interest-Rates / Eurozone Debt Crisis
By: Nadeem_Walayat
It appears times up for the Greek Trojan Horse that has been parked outside of the European Central Bank for years, slowly but steadily bleeding the euro-zone dry of now in excess of Euro 360 billion (E240 billion bailout + E120 billion banking system support), as the euro-zone bureaucrats and politicians are finally starting to understand what many have understood for the past 5 years that Greece just cannot function within the Euro-zone, it should never have been allowed to join with bogus economic statistics and subsequently should not have been bailed out again and again and again.
Thursday, June 18, 2015
Bond Bubble - The Fed is Now Officially in VERY Serious Trouble / Interest-Rates / US Bonds
By: Graham_Summers
The market action of the last 24 hours can be summated as thus:
The Fed didn’t raise rates, so the US Dollar fell and all risk rallied hard.
The fact the Fed didn’t raise rates is not important. Interest rates have not been at zero for six years. And the last real period of tightening ended in 2006, nearly a full decade ago.
Read full article... Read full article...
Thursday, June 18, 2015
GREXIT - Greece Wants to Become Scotland, Seeks Permanent Subsidy from Euro Tax Payers / Interest-Rates / Eurozone Debt Crisis
By: Nadeem_Walayat
The Greece debt crisis is marching towards its end game of GREXIT, as the socialist Syriza government continues to up the anti every other day by threatening to blow a hole in the euro-zone through defaulting on overdue debt payments that now total Euro 1.6 billion, having already delayed payment of for several weeks through the use of the euro-zone rule book as Greece demands bailouts forever to permanently service Greece's debt AND finance government deficit spending.
Thursday, June 18, 2015
UK Jobs, BoE, Sterling and Yield Spreads / Interest-Rates / UK Interest Rates
By: Ashraf_Laidi
Today's UK jobs figures powered the pound across the board as average weekly earnings growth (excluding bonuses) shot up to a six-year high of 2.7% in the three months to April y/y, exceeding market expectations for a 2.1% rise. Substracting the 0.1% level of inflation, real earnings come in at 2.6%, also the highest since 2009. If wage gains persist on their upward trend, then wage cost inflation would follow, forcing the gilt market to price more aggressive expectations for a BoE rate hike.
Read full article... Read full article...
Wednesday, June 17, 2015
Geopolitics Will Trump Economics in Greece / Interest-Rates / Eurozone Debt Crisis
By: John_Browne
Based on the continued failure of the negotiating parties to make any substantive progress in the talks over Greek debt payments, the financial world is tied up in knots over a possible Greek exit from the European Union. The uncertainty has manifested in both high and low finance, with a sharp sell-off in bonds, particularly EU and Greek government debt, and heightened retail withdrawals from Greek banks as depositors become wary of capital controls that would be imposed in the case of an exit. All concerned parties should likely breathe easier. Despite Greece's almost complete lack of financial integrity, neither NATO nor the EU can afford the political cost of a Greek exit from the EU.
Read full article... Read full article...
Wednesday, June 17, 2015
Global Bond Market Crash Could Be “Ground Zero” for the Biggest Financial Crisis Ever / Interest-Rates / Bond Bubble
By: ...
MoneyMorning.com Shah Gilani writes: Let’s start with a surprising truth.
Though not many folks know this, the credit crisis-spawned stock market crash of 2007-’09 created a hefty number of millionaires
There’s a reason for this, and that reason sits inside the simple market maxim that every crisis is accompanied by big opportunities.
Read full article... Read full article...
Wednesday, June 17, 2015
Let’s Just Get This Greece Thing Over With / Interest-Rates / Eurozone Debt Crisis
By: John_Rubino
Guys, please. As much as we all love a good crisis, this is getting old. The threats, the name-calling, the apocalypse certain to occur if one side doesn’t immediately cave to the other’s unreasonable demands. Seems like your Greek tragedy has been going on forever, and like a long-running TV show that keeps pushing the big reveal into the next season, your audience is beginning to lose interest.
Or is that the goal? Exceed our attention span, send us off to more vibrant stories like Russia or ISIS or Caitlyn Jenner — and then, when no one is looking, hit us with something really crazy. By now, that possibility is all that’s keeping us tuned in.
Read full article... Read full article...
Wednesday, June 17, 2015
Stop the Fed!? / Interest-Rates / US Federal Reserve Bank
By: Axel_Merk
We are concerned the Fed causes both economic and political stability to deteriorate. And, no, this is not about discouraging the Fed to hike rates. This analysis is about pointing out that the road to hell may be paved with the best of intentions. For the economy to prosper, we need a re-thinking not just at the Fed, but also with some Fed critics. Let me elaborate...
Tuesday, June 16, 2015
Why the Fed Is Afraid To Raise Interest Rates / Interest-Rates / US Interest Rates
By: Michael_Pento
Even though the major stock market averages are flat for the first six months of the year, by nearly every measure the stock market is still extremely overvalued. This point is not lost on Ms. Yellen and company, as the Fed Chair herself has recently assented that the current value of stocks are "quite high". Given this, the Fed must privately be afraid that even a small change in the Fed Funds Rate could serve as the needle that pops the massive bubble in the stock market.
Monday, June 15, 2015
Monetary Quackery in Ireland / Interest-Rates / Credit Crisis 2015
By: Antonius_Aquinas
If Ireland is ever going to leave PIIGS status (the acronym for Europe’s most indebted and financially challenged economies – Portugal, Italy, Ireland, Greece, Spain), it must stop listening to, and then criminally prosecute the monetary authorities which have brought the country to financial ruin. It can start this most necessary process with the nation’s central bank governor, Patrick Honohan. Not only must Professor Honohan be hauled away, preferably in chains, but the sinister institution in which he heads, Ireland’s central bank, Banc Ceannais na hÉireann, must be eradicated.
Read full article... Read full article...
Monday, June 15, 2015
Bond Market Bombshell - Deflation Rules! / Interest-Rates / US Bonds
By: Clive_Maund
DEFLATION RULES! - because periodic recessions, necessary to rebalance the economy after periods of growth, cannot be put off forever by the short-term expedient of printing money. The result of such corrupt and evasive practices is that the deflationary forces build up to catastrophic and overwhelming proportions leading to economic collapse and depression. This is the point that we have arrived at now. Why can't governments keep the game going indefinitely by printing more and more money? - because the debt grows and grows until it becomes apparent even to dull-witted bond / Treasury holders that they are never going to get their money back, so they start selling and the selling snowballs into an avalanche, driving interest rates through the roof. Bond and stockmarkets crash and the economy sinks into a dangerously deep depression, all because governments stubbornly refused to do the right thing all along, and interfered with and obstructed normal market forces, culminating in their idiotic and ruinous QE, ZIRP and now even NIRP.