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10 Year Treasury

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http://finance.yahoo.com/echarts?s=%5ETNX+Interactive#chart1:symbol=^tnx;range=my;indicator=sma(50,200,10)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=off;source=undefined

In my eyes, the SECULAR cycle is over.

Rates going up. Inflation.

Yeah QE3 didn't have the desired effect of suppressing yields for the US this time, so it looks like QE isn't going to cut it any more.

Having said that, I remember reading that once QE was started, just like a junkie and his fix, each subsequent hit would need to be bigger to get the desired effect, QE3 wasn't.

So, I voted for rising rates bought about by rising bond yields, caused by bond holders getting the hell out of dodge in the face of inflation. However, I wouldn't put it past western governments to hit the nuclear button and QE to infinity and monetise all their lovely bonds/gilts in a blaze of Weimarish glory, which will suppress interests rates alright (cos they'll be the only buyers of the debt), but will lead directly to a tidal wave of inflation. What other choice do they have? Crash and burn in a deflationary implosion? Governments will always print out of desperation, it seems the lesser of two evils to them, as it keeps them in a job a bit longer.

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Yeah QE3 didn't have the desired effect of suppressing yields for the US this time, so it looks like QE isn't going to cut it any more.

Having said that, I remember reading that once QE was started, just like a junkie and his fix, each subsequent hit would need to be bigger to get the desired effect, QE3 wasn't.

So, I voted for rising rates bought about by rising bond yields, caused by bond holders getting the hell out of dodge in the face of inflation. However, I wouldn't put it past western governments to hit the nuclear button and QE to infinity and monetise all their lovely bonds/gilts in a blaze of Weimarish glory, which will suppress interests rates alright (cos they'll be the only buyers of the debt), but will lead directly to a tidal wave of inflation. What other choice do they have? Crash and burn in a deflationary implosion? Governments will always print out of desperation, it seems the lesser of two evils to them, as it keeps them in a job a bit longer.

100% guaranteed.

Now, where is the astroturfer, scepticus / EDM? (S)he must still be in bed

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I'm confused.

The poll asks if 10 year treasury notes are going to go up or down.

Am I right in thinking that it is actually intending to ask if the yield on these is going to go up or down?

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I'm confused.

The poll asks if 10 year treasury notes are going to go up or down.

Am I right in thinking that it is actually intending to ask if the yield on these is going to go up or down?

The question is referring to which way the yield will go, the price of the gilt/bond goes the opposite way to the direction of the yield.

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Warren Buffett: "I have made most of my money by observing the herd and investing in the opposite."

The questions for us:

1. Which way is the herd moving?

2. Does the eonomic cycle still apply and what has happened in the past 20 or so years with regard to inflation--up or down?

3. What follows when a bubble begins to deflate?

4. Is now the time to quietly unload gold?

Edited by Realistbear

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The question is referring to which way the yield will go,

That's what I thought, though without the word "yield" somewhere in the thread title or the question, it is somewhat unclear.

the price of the gilt/bond goes the opposite way to the direction of the yield.

I know. That's why I asked.

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Warren Buffett: "I have made most of my money by observing the herd and investing in the oppositie."

The questions for us:

1. Which way is the herd moving?

2. Does the eocnmic cycle still apply and what has happened in the past 20 or so years witrh reard to inflation--up or down?

3. What follows when a bubble begins to deflate?

4. Is now the time to quietly unload gold?

The herd are milling around. They can smell the lions but they can't yet see them so they don't know which way to run.

We are in a holding pattern.

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Here are the real returns of various US assets over historical periods:

Years ... Stocks ... T Bills ... 10 Yr Treasuries ... Gold

1929-41 ... -2.3% ... 1.5% ... 4.1% ... 4.2%

1942-65 ... 12.1% ... -1.5% ... -0.9% ... -3.1%

1966-81 ... -1.4% ... -0.3% ... -3.6% ... 8.4%

1982-99 ... 15.0% ... 2.9% ... 7.1% ... -4.9%

2000-09 ... -3.4% ... 0.2% ... 3.7% ... 11.9%

The first four periods show a clear Kondratieff pattern and the current period is largely mimicking the first. The big question is when does the "winter" end. My guess, based on the fact that the deleveraging of consumers in the west has just begun, is sometime towards the end of the decade.

At the beginning of the two booms in equities cyclically adjusted PEs were in the 6 to 8 range compared to about 20 currently on the S&P 500. Most other developed stock markets are much much cheaper.

IMO we will see blips of inflation but bonds and equities will be in a trading range for the next 8 to 10 years.

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At the beginning of the two booms in equities cyclically adjusted PEs were in the 6 to 8 range compared to about 20 currently on the S&P 500. Most other developed stock markets are much much cheaper.

In March 2009 defensive high yield, cash rich blue chips were trading at 6-8 times earnings. Some still do.

Russia hit a P/E of 5 or so in March 2009. Lovely.

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H

At the beginning of the two booms in equities cyclically adjusted PEs were in the 6 to 8 range compared to about 20 currently on the S&P 500. Most other developed stock markets are much much cheaper.

Any idea what the PE ratio was in 1966 at the end of the first boom?

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  • 311 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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