Folks, the market is shouting - SCREAMING — that we are on a troublesome economic path. The tinkerers in Washington and Treasury are driving the dollar into the crapper. They’re putting Treasuries into the shredder. The mortgage markets just dislocated in a huge way. And gold is flying toward $1,000 an ounce.
Oh and don’t forget [...]
From the monthly archives:
May 2009
The Treasury just held its much-anticipated 7-year Treasury note auction. The sale of $26 billion in 7-year notes was the third leg in this week’s debt sales, which also included 2-year and 5-year auctions. So how’d the auction go? The notes sold at a yield of 3.3%, compared with pre-auction talk of 3.263%. The bid-to-cover [...]
The Mortgage Bankers Association released data on first quarter mortgage delinquencies and foreclosures this morning. This is what the numbers showed:
* The overall mortgage delinquency rate soared to 9.12% in Q1 2009 from 7.88% in Q4 2008 and 6.35% a year earlier. This is yet another record high for the delinquency rate (the MBA data [...]
Watching the market action this morning, I can’t help but think the Federal Reserve is in a total Catch 22 situation. It can signal a plan to increase its purchases of Treasuries and mortgages to hold rates down. Indeed, speculation about just such a move has driven long bond futures up almost two points in [...]
My call in December that long-term Treasuries were caught up in the “Biggest bubble of all” is looking right on target. The bonds simply can’t get out of their way. Long bond futures are down about 1 16/32 as I write, while 10-year Treasury Note yields have shot up by more than 10 basis points [...]
An article in the Washington Post says the idea of a national U.S. sales tax is gaining a bit of traction. If you’ve ever travelled abroad, especially to Europe, you’re probably familiar with the idea of a VAT, or value-added tax.
I’ve always found the name a bit ironic. And my favorite part of the VAT has always been that [...]
We just got a look at April existing home sales figures. Here’s a recap of what they showed:
* Existing home sales rose 2.9% to a seasonally adjusted annual rate of 4.68 million units from 4.55 million in March. That was roughly in line with the forecast for a reading of 4.66 million and down 3.5% [...]
With GM bondholders now in outright rebellion against the U.S. government’s offer to swap their bonds for stock, and with the collapse of negotiations on Wednesday, it’s now widely known that a GM bankruptcy is inevitable by June 1.
What’s not so widely known is the real consequences for the economy and U.S. [...]
The selling just keeps on washing over the long-term bond market. After a brief bounce in the wake of the 2-year note sale earlier this afternoon, bonds rolled over. Futures are now down 25/32 at 118 17/32. The yield on the 10-year Note has risen another 5 basis points to 3.5%. The dollar is still [...]
The latest numbers from S&P/Case-Shiller’s housing index prove that things haven’t gotten any better for housing in 2009. In fact, the data shows that prices declined 19.1% in the first quarter of the year (following an 18.2% drop in Q4 2008)! Remember, this index is an extremely good indicator of what’s actually happening in the [...]
