And Ben will keep pounding the nails until we’re all dead, dead, dead. The banks and gov’ts (indistinguishable at this point) will be all that’s left.
Bernanke’s policy now boils down to “if it doesn’t work, we’ll keep doing it until it does”. Those on fixed incomes have been crucified by the Fed’s policies and will continue to be crucified by the Fed’s policies until low interest rates work.
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Treasuries rallied as banks and brokers font-ran the trade.
This is all well and good for the 1% and for the banks that front-ran the bond trade, but it sure is not doing anything good for those on fixed income or most of the 99%.
As Scott Bleier said on Twitter: ‘We will soon say, “I remember when $50k bought a really nice car”…’
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Haha I hope we don’t get to $100k price tags for used cars but nothing is impossible at the rate they are printing and supplying money. Once investors lose their appetite for US bonds rates are going jump fast.
Agreed Kirk. Right now, it looks as though TLT could break up or down – either way. Guy Lerner thinks it (bonds) is topping.
Just looking at the chart, there is a lot of air underneath the TLT price and the 10 & 50 day averages.
Sorry, I was looking at the weekly.
A breakdown in bonds – higher rates – could really throw a wrench in to things. Ask Greece. Or Portugal.
It would decrease the amount of home buyers that still exist. As rates rise, buyers can afford less because the payments would be more.