Ten Year Bond and Rising Interest Rates

[Neubarth]

http://finance.yahoo.com/echarts?s=^TNX#symbol=^TNX;range=6m

Look at the six month trend on the ten year bond. If this keeps up, we will have serious damage to any potential recovery to the economy.

 

[wimpy77]

and also the 2/10 spread is going up right now its at the 2.7%. so mortgage rates will go up on 30 fixed. but the fed has basically said they will not do anymore that want they have announced.

right now most economist are of the opinion that from october until march we were in a depression and in march we went into a recession. this recovery is gonna be a sloth and very slow. things at this point are less bad. imo the market has gotten ahead of itself and i wouldn't be suprised if we got some sort of correction, but people have be predicting that for over 2 months and it still hasnt happened.

 

[Neubarth]

and also the 2/10 spread is going up right now its at the 2.7%. so mortgage rates will go up on 30 fixed. but the fed has basically said they will not do anymore that want they have announced.

right now most economist are of the opinion that from october until march we were in a depression and in march we went into a recession. this recovery is gonna be a sloth and very slow. things at this point are less bad. imo the market has gotten ahead of itself and i wouldn't be suprised if we got some sort of correction, but people have be predicting that for over 2 months and it still hasnt happened.

I posted this graph on another string, but it is appropriate here as well.
Just like the Wall Street Crash in 1929, there has been a rebound even though the economy continues strongly downward.

Note how the initial fall in 1929 was about 40% and the rebound into 1939 was about half of the loss. Everybody was just like now wishing for a V shaped recovery. That was not to be, exactly like now. The economy continued down then, and it is continuing down now.

There are no data showing a recovery no matter how much Washington lies about it.
The deterioration is gradual, so all of the misleading news releases accompanying all of the government's data can be misleading to a great many people.

 

[wimpy77]

and also the 2/10 spread is going up right now its at the 2.7%. so mortgage rates will go up on 30 fixed. but the fed has basically said they will not do anymore that want they have announced.

right now most economist are of the opinion that from october until march we were in a depression and in march we went into a recession. this recovery is gonna be a sloth and very slow. things at this point are less bad. imo the market has gotten ahead of itself and i wouldn't be suprised if we got some sort of correction, but people have be predicting that for over 2 months and it still hasnt happened.

I posted this graph on another string, but it is appropriate here as well.
Just like the Wall Street Crash in 1929, there has been a rebound even though the economy continues strongly downward.

Note how the initial fall in 1929 was about 40% and the rebound into 1939 was about half of the loss. Everybody was just like now wishing for a V shaped recovery. That was not to be, exactly like now. The economy continued down then, and it is continuing down now.

There are no data showing a recovery no matter how much Washington lies about it.
The deterioration is gradual, so all of the misleading news releases accompanying all of the government's data can be misleading to a great many people.

toro has posted data that proves that things are recovering very slowly. as much as you dont wanna believe it we aren't in a freefall things are just less bad but still not good. like i said in my above post i believe the market is getting ahead of itself. this recovery is probably gonna be sloth and you're right i highly doubt this thing is gonna be a V shaped recovery more like an L. tomorrow will be an interesting day, we will see how far the unemployment rate grew most people think 9.2%.

 

[Neubarth]

As you can see today, the Obama administration's distortions have ballooned so far out of reality that the numbers are off by nearly 100%!!!!!

Now, with the 10 year bond up to 3.8% interest I wonder if Toro still feels the same way about the economy? There are no data that remotely suggest a recovery at the end of this year. That nonsense is just so much lies/distortions.

 

[wimpy77]

it sucks if you wanna buy or refinance a house.

 

[Toro]

Bond yields always rise as the economy strengthens. That's how it is supposed to work.

 

[Neubarth]

Bond yields always rise as the economy strengthens. That's how it is supposed to work.

I have never heard that theory. I know from experience that bond Yields rise when there is a surplus of bonds on the market. When yields rise, the price of the bond goes down. That is a direct reflection on an excess supply in the market be it soap, grain or pork.

If there is too much of any product, the price goes down. With bonds, the price goes down and subsequently the yield goes up. It is a direct reflection of inflation.

 

[justabubba]

I have never heard that theory. I know from experience that bond Yields rise when there is a surplus of bonds on the market. When yields rise, the price of the bond goes down. That is a direct reflection on an excess supply in the market be it soap, grain or pork.

if i understand your point, this enhanced yield indicates too little currency available to purchase the available bonds
that seems consistent with your next point:

If there is too much of any product, the price goes down.

again, you assert that the funds available to acquire available bonds is inadequate to sustain the prior bond values, thus driving the yield up
i believe that is consistent with your subsequent remark:

With bonds, the price goes down and subsequently the yield goes up.

however, you attribute the cause of the inadequate bond capital to be inflation:

It is a direct reflection of inflation.

if the bonds are being discounted to attract investment capital, isn't that surplus supply of bonds, when compared to available capital, contraindicative of inflation? it would seem to be inflationary if bond values were being improved because of the demand pressure to acquire them - which is not now present

not saying you are wrong, just unable to reconcile inflation being the underlying factor when that is not evident within the bond market, itself