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Posts Tagged ‘bursting bond bubble’

Uh Oh. … Trouble Dead Ahead

Posted by smeddum on August 24, 2009


Karl Denninger
Market Ticker

Aug 22, 2009

While I disagree with pretty much everything Jim Willie writes when it comes to metals and such, every squirrel finds a nut once in a while:

click to enlarge

You can read the original article at the above link, or I’ll just point out the important parts:foreigners are rejecting virtually all forms of US debt, most specifically corporate and agency (mortgages.) Read the rest of this entry »

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Default Risk Too High for World’s Taste

Posted by smeddum on August 23, 2009

Default Risk Too High for World’s Taste

August 23, 2009

Seeking Alpha

It was another Ponzifest on Wall Street Friday as better than expected home sales took stocks to new highs.

There was also a negative side in this report: Home inventories failed to shrink as more condos were dumped onto the market. This part of the news, of course, was ignored as Wall Street’s bubble making machine rolled on. Read the rest of this entry »

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Radio: Jim Willie on yuan bond threat

Posted by smeddum on August 6, 2009

http://www.contraryinvestorscafe.com/partners.php?pid=62242

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A warning bell on California muni bonds

Posted by smeddum on June 30, 2009

A warning bell on California muni bonds
As sure as the sun will set on the Golden State, analyst Martin Weiss says California is going to default.

By Jon Birger, senior writer
Last Updated: June 25, 2009: 2:21 PM ET

NEW YORK (Fortune) — Known for his early warnings on Bear Stearns and Lehman Brothers, analyst Martin Weiss of Weiss Research is now sounding the alarm about state of California municipal bonds.

In a new report, Weiss has some rather blunt advice for California muni investors: “Sell all California paper now!” His reasoning? California is facing a $24 billion budget gap with no obvious way to close it. Read the rest of this entry »

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US treasury: The Biggest Victim of the Debt Crisis

Posted by smeddum on June 8, 2009

The Biggest Victim of the Debt Crisis 
by Martin D. Weiss, Ph.D. 

Monday, June 8, 2009

HoweStreet

 

Martin D. Weiss, Ph.D.

Just as we’ve been warning, the United States Treasury is the next and largest victim of this great debt crisis.

Right now, the Treasury’s finances are collapsing … its bond prices plunging … its interest rates surging.

Indeed, the Treasury’s financial crisis looms so large, it could wreck more havoc on the economy and deliver more pain to average Americans than the subprime mortgage disaster, the housing bust, the banking crisis, and the collapse of General Motors put together … Read the rest of this entry »

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Jim Willie: Quarterly $1 Trillion Monetization

Posted by smeddum on June 4, 2009

by Jim Willie, CB. Editor,

Hat Trick Letter |

June 2, 2009

The rising long-term USTreasury Bond yield has captured attention. The breakout chart for the 10-year Treasury was pointed out here when it rose over 3.1%, hardly a high level. In the first week of May, a target of 3.5% was cited, one easily surpassed. It zoomed to 3.75%, enough to create some waves in the stock market distracted and preoccupied by nonsensical Green Shoots talk on the psychological side and by falsified bank balance sheets on the accounting side. Bigtime stress has come to the USTreasury complex, a story difficult to mask and conceal, since it is at the epicenter of the credit markets. Only on Wall Street can we hear lunacy of less bad economic statistics (framed in sophisticated second derivative arguments) amidst an absolute cavalcade of miserable news on the jobs front, home foreclosure front, and home price front. So the unemployed workers, dispossessed homeowners, and insolvent households will lead the nation on a recovery, while credit approval is much more strictly applied even to the creditworthy among us? Doubtful! Only on Wall Street can we hear of the banks undergoing a healing process when huge credit asset writedowns are replaced instead by convenient ‘Credit Value Adjustments’ as booked profits on their books.

Read the rest of this entry »

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Bond markets defy Fed as Treasury yields spike

Posted by smeddum on May 29, 2009

The US Federal Reserve may soon be forced to launch fresh blitz of quantitative easing whatever the consequences for the US dollar, or risk seeing economic recovery snuffed out by the latest surge in long-term borrowing costs.

By Ambrose Evans-Pritchard
29 May 2009
Telegraph

Market expects Fed will have to double purchases of Treasuries.
Yields on 10-year Treasury bonds have risen relentlessly since March when the Fed first announced its plan to buy $300bn (£188bn) of US government debt directly, a move that briefly forced rates down to nearly 2.5pc, a level thought to be the Fed’s implicit target.
Yields have jumped to 3.69pc – after spiking as high as 3.74pc on Wednesday – pushing up the standard 30-year mortgage loan to 5.08pc and lifting the borrowing cost for corporations. Read the rest of this entry »

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China fears bond crisis as it slams quantitative easing

Posted by smeddum on May 7, 2009

China fears bond crisis as it slams quantitative easing
China has given its clearest warning to date that emergency monetary stimulus by Western governments risks setting off worldwide inflation and undermining global bond markets.

By Ambrose Evans-Pritchard
07 May 2009
Telegraph

“A policy mistake made by some major central bank may bring inflation risks to the whole world,” said the People’s Central Bank in its quarterly report.
“As more and more economies are adopting unconventional monetary policies, such as quantitative easing (QE), major currencies’ devaluation risks may rise,” it said. The bank fears a “big consolidation” in the bond markets, clearly anxious that interest yields will surge as western states try to exit their QE experiment.

Simon Derrick, currency chief at the Bank of New York Mellon, said the report is the latest sign that China is losing patience with the US and aims to diversify part its $1.95 trillion (£1.3 trillion) foreign reserves away from US Treasuries and other dollar securities. Read the rest of this entry »

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Fed needs to double balance sheet: PIMCO

Posted by smeddum on March 27, 2009

By Faith Hung
Thu Mar 26,
TAIPEI (Reuters) – Bond giant Pacific Investment Management Co said the Federal Reserve needs to double its balance sheet up to $6 trillion to replace the amount of wealth destroyed in the United States, an executive said on Thursday. Read the rest of this entry »

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U.S. Treasury Bonds Heading for Day of Reckoning

Posted by smeddum on March 27, 2009

Mar 27, 2009
Market Oracle
Mike Larson writes: The U.K. Treasury held a bond auction on Wednesday morning. On the offer were 1.75 billion pounds ($2.55 billion ) worth of 40-year “Gilts” — the U.K. equivalent of U.S. Treasuries. There was just one problem …

Buyers went on strike! They offered to purchase just 1.63 billion pounds ($2.37 billion) of debt. Read the rest of this entry »

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