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I R Soar In U S As Key 10 Year Bonds Climb

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http://www.bloomberg.com/news/2010-11-13/treasuries-slump-as-federal-reserve-begins-second-round-of-monetary-easing.html

Treasuries Slump as Federal Reserve Begins Second Round of Monetary Easing
By Cordell Eddings and Susanne Walker - Nov 13, 2010 5:00 AM
Treasuries tumbled, with two-year note yields rising the most in 10 months, as government debt sales received lower-than-average demand even as the Federal Reserve started a second round of monetary stimulus.
Treasury 10-year notes rose 26 basis point for the week, the most since December 2009,
ahead of government reports forecast to show U.S. retail sales and consumer prices increased, indicators of faster economic growth. The Fed began buying $105 billion of debt through Dec. 9 to spark the economy and lift inflation expectations, including as much as $34.5 billion next week.

The Bond market has called time on low IR. The same will happen here as Bond Markets are even more sensitive to national moves than stocks are. They have been warning about the bond bubble for some time and Bill "William" Gross has also been issuing warnings.

Goodbye HPI it was nasty knowin ye.

Edited by Realistbear

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Biggest bubbble of the lot, combined with rolling bubbles in housing, stgocks and commodities.

All down to lax monetary policy, which on the scale we have seen has been nothing short of outright fraud.

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This news is possibly the BIGGEST story on HPC for many months.

Two things will send prices tumbling in this country:

Global IR move to upside and jobs.

I've been waiting for the bond markets to react to our money printing and QE for ages now. All said on here about bond markets not liking negative real interest rates, made sense. So I couldn't work out why they could get away with it for so long.

Isn't 26 basis points a quarter of a percent? That isn't that much is it?

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That Bill Gross must be a bit miffed - what sort of person has their full name as their nickname? Even Steve 'Interesting' Davis has a more interesting handle.

Anyhow, why buy more US bonds when you know that QE3, QE4, QE5, etc is in the future.

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I've been waiting for the bond markets to react to our money printing and QE for ages now. All said on here about bond markets not liking negative real interest rates, made sense. So I couldn't work out why they could get away with it for so long.

Isn't 26 basis points a quarter of a percent? That isn't that much is it?

When IR are very close tro 0 it is quite a nice move. As the cost of the bond moves up the chain to retail level it picks up even more by way of interest.*

Bottom line for bonds: they price for riisk and if the market smells a meltdown (as in Ireland and Greece) they will go balistic. I think this is why the BoE are paralysed with fear knowing what will happen to HPI with even a small nudge upwards. Merv must know that if he allows inflation to go without an IR hike the rate will have to go that much higher in due course because the bond market will have overriden any policy that may be in place to keep HPI on track with low IR.

I suspect Merv is hoping the recovereh will have locked in by the time he is forced to allow IR hikes. I don't think he will get that lucky and we will have our big correction whatever they try to do--they can't beat the bond market.

______________________

Edit:

*Checked my US Fidelity brokerage account this morning and see CDs have risen from .20% to .30% overnight. Huge move percentage-wise.

Edited by Realistbear

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Rising interest rates is the key.

If they rise in the UK, the the government has to stop posturing, and balance the budget. No ifs or buts, it has to do it or collapse the pound.

That means no more susidies into the housing market, which will enable non-mortgage payers to be repossessed again. Add in the fact that there will be lots more defaulting at higher rates of interest, and we will finally have our crash.

Bring it on.

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Is this going to happen or is it more wishful fantasy thinking... because if we are having the latter then I wish to bring Kelly Brook, Kylie, Jennifer Aniston, Halle Berry and Seven of Nine into the mix.

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Is this going to happen or is it more wishful fantasy thinking... because if we are having the latter then I wish to bring Kelly Brook, Kylie, Jennifer Aniston, Halle Berry and Seven of Nine into the mix.

If you mean higher interest rates, then yes, more fantasy thinking.

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Is this going to happen or is it more wishful fantasy thinking... because if we are having the latter then I wish to bring Kelly Brook, Kylie, Jennifer Aniston, Halle Berry and Seven of Nine into the mix.

IR rises are happening.

The Bond market moved quite considerably higher in the US on Friday and I am seeing it in my brokerage account this morning and especially in my bond funds (which I liquidated almost completely about 2 weeks ago--due to Bill's warnings and seeing the amount of cash these funds were holding relative to bonds).

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If you mean higher interest rates, then yes, more fantasy thinking.

Yes, no, maybe.

Bootle reckons they'll stay low for years. Some posters reckon the bond market will have its say in the end. Me, I'm keeping my fingers crossed. I wonder what Kelly Brook's opinions about interest rate levels are?

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Yes, no, maybe.

Bootle reckons they'll stay low for years. Some posters reckon the bond market will have its say in the end. Me, I'm keeping my fingers crossed. I wonder what Kelly Brook's opinions about interest rate levels are?

i thought she was a goner,something to do with the voracious appetite of piranhas

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This is where the inflationist have got it totally wrong.

Just because the governement can print it doesn't mean they will. What is to stop them? I say again, The Bond Market.

No bond holder is going to sit back and watch as YOUR debts and THEIR weath gets inflated away - It just won't happen.

When the bond market says no more QE then it ends and we deflate - Is this it now? I don't know, but it will happen.

The coming deflationary collapse will be as big as the inflationary bubble that preceeded it - MASSIVE.

Thanks for reading and congrats if you finally get it.

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This is where the inflationist have got it totally wrong.

Just because the governement can print it doesn't mean they will. What is to stop them? I say again, The Bond Market.

No bond holder is going to sit back and watch as YOUR debts and THEIR weath gets inflated away - It just won't happen.

When the bond market says no more QE then it ends and we deflate - Is this it now? I don't know, but it will happen.

The coming deflationary collapse will be as big as the inflationary bubble that preceeded it - MASSIVE.

Thanks for reading and congrats if you finally get it.

I understand what you are saying. It's just that there are others on here saying they will print until the cows come home. And they have already got away with the base rate at 0.5 for 19 months, and one lot of queasing. I'm waiting for the bond market to call time, I just wish they'd HTFU.

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So, can I ask what's happening or what you think is going to happen in plain English, my guesses are:

  • US bonds have fallen in value, the yields (interest rates) have hence gone up.
  • This is because QE2 has made international investors scared, if they invest in Dollar bonds, then the dollar will fall in value due to QE and devalue the investment.
  • The extra QE has also pissed the chinese off and they're not buying as much as they were?

About right?

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So, can I ask what's happening or what you think is going to happen in plain English, my guesses are:

  • The extra QE has also pissed the chinese off and they're not buying as much as they were?

About right?

There was a thread on here that stated China was semi dumping US$ too, something about last year it was 860bn this year around 845bn. China is also spending them like crazy too! Infrastructure projects which they didn't have the money for are suddenly being given the green light. The South North water project for instance, they were considering tunnels to be built in 2012-2018 but they've been building them since 2008.

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I understand what you are saying. It's just that there are others on here saying they will print until the cows come home. And they have already got away with the base rate at 0.5 for 19 months, and one lot of queasing. I'm waiting for the bond market to call time, I just wish they'd HTFU.

If they really believe that "they will print until the cows come home" then they haven't read or understood any economic history.

No country with a sophisticated bond market has ever hyperinflated.

What do you mean by "got away with the base rate at 0.5 for 19 months"? base rates are low because the smart money knows deflation is coming. These people are not interested in gambling on the last few gains in the stock market, junk bonds or commodities. The big move is down and it's all about protecting youself in the long term. There is no hurry, the bond market will call time when it's ready.

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If they really believe that "they will print until the cows come home" then they haven't read or understood any economic history.

No country with a sophisticated bond market has ever hyperinflated.

What do you mean by "got away with the base rate at 0.5 for 19 months"? base rates are low because the smart money knows deflation is coming. These people are not interested in gambling on the last few gains in the stock market, junk bonds or commodities. The big move is down and it's all about protecting youself in the long term. There is no hurry, the bond market will call time when it's ready.

there is a huge amount of impatience on here, people want things yesterday, from the monthly moves on house price indices to RBs hourly moves on the stockmarkets, its undestandable i suppose if unfortunate enough to have been shafted through ultra prudence and waiting for a decade but the reality is things only potentially topped 3 years ago and we are talking of a condition that took nearly a century to build up, theres also the reality ive noticed for this site to get emotional and extrapolate any momentary trend as forever continuous be it bearish or bullish, quite ironic given the propensity for the derogatory term sheeple to be used on here

Edited by Tamara De Lempicka

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there is a huge amount of impatience on here, people want things yesterday, from the monthly moves on house price indices to RBs hourly moves on the stockmarkets, its undestandable i suppose if unfortunate enough to have been shafted through ultra prudence and waiting for a decade but the reality is things only potentially topped 3 years ago and we are talking of a condition that took nearly a century to build up, theres also the reality ive noticed for this site to get emotional and extrapolate any momentary trend as forever continuous be it bearish or bullish, quite ironic given the propensity for the derogatory term sheeple to be used on here

Yep, patience is the key, its the youngguns, they want it now, it took 13 years to get here, and that forgetting the previous 25 years of debt stock piling.

For me the year 2018 sticks out as a low, but any time after 2015 could flag up RED? Till then just enjoy partake and do not buy into the direction all and sundry take, run in the opposite..............

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If they really believe that "they will print until the cows come home" then they haven't read or understood any economic history.

No country with a sophisticated bond market has ever hyperinflated.

There is a first time for everything. For example there was a silly law about war. Whereby two countries with Mc'ds will never go to war.... This fell apart in 2009 when Georgia was attacked by Russia. Also you appear to think that the US/UK government pull all the strings and therefore it is under their total control and they can choose where to fight. They don't have this level of control althought they'd want to, even the CCP doesn't have that level of control nor does North Korea as their own inflation control measures failed. This is NORTH KOREA I'm talking about.

Many of the triggers of hyperinflation are NOT under their control and thus WHEN not if it happens it will catch the fed/BoE off guard (or they will pretend to be caught off guard).

Have a look at one possibility of it occuring

http://www.businessinsider.com/how-hyperinflation-will-happen-in-america-2010-9#a-slight-but-sudden-rise-in-the-price-of-a-necessary-commodity-1

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I held the missus off buying in 2007 and said no to buying a house when house prices were rising by at least double digits per year.

I'm hardly young I'm thirty eight.

The idea that renting is dead money has some truth about it. Once you own your own place outright, you only have maintenance costs to pay. Whereas rent rises are eternal. Of course if you buy at the top of a bubble and prices drop 50 % in five years, then it would have been better to wait five years.

I'm not really worried about hyperinflation. I'm worried about reasonable inflation. Wages and prices going up by 40 percent over six or so years, and house prices staying where they are.

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Thoughts, an interesting post.......................................

The private central bank of America, the Federal Reserve, controls the money supply. They create inflation in the first phase by raising interest rates and easing borrowing requirements for things like mortgages (through the political arm of their organization) - remember all those home improvement shows when every second TV show was about buying homes or fixing them up? That was part of the manipulation. Derivatives and packaged loans sold as investment vehicles flew like crazy - investors couldn't get enough of them. This is where a lot of people's pensions ended up, buying these securities. The government in many countries pushed the people to have superannuation schemes at this time - they made it mandatory in some nations. The bankers knew that this superannuation money had to be invested in something so that's why they instigated it - more money into the pool. That was the name of the game - increase the money in the pool. In a similar way to a Ponzi scheme, people made money at first, the people who joined the pyramid first made spectacular profits - this fed the greed of potential investors who threw their money into the hat eager to make easy money.

So a bubble was created and then it burst. Now was the time for the value of the bankers' money to increase - by deflation. So first of all inflation - encouraging people to give up their money, then deflation - works every time; the suckers never learn no matter how many times this cycle happens.

The bankers with their money that has risen in value (because it's scarce) invest their money now and lock it in - they buy property and businesses for pennies on the dollar so the bankers buy cheap (to sell high later). They will hang on to the hard assets while the economic climate is depressed and once it picks up, they will liquidate.

The BANKERS determine whether there will be deflation, inflation or hyperinflation. Sometimes they bring about one of these to make money, sometimes for political reasons.

The main message is that nothing happens by accident; some people are always in control, and they always inflate or deflate the money supply according to their benefit.

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Many of the triggers of hyperinflation are NOT under their control and thus WHEN not if it happens it will catch the fed/BoE off guard (or they will pretend to be caught off guard).

Hyper-inflation is an over-hyped and will not occur any time soon in the US, Europe or the UK. Everything points to deflation and governements are fighting like mad to avoid it but ultimately it's impossible. The latest QE2 is just a blip compared to the mountain of debt that will implode.

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  • 150 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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