Rob Viglione

Bond Expert: Friday Wrap

Agreed that the Fed and feds will put pressure on the bond market to suppress yields. Federal budget is far too sensitive to rates, and the Treasury still have a few trillion more in securities to dump onto the market over the next couple years. Letting rates move too high now could be devastating for the Man Behind the Curtain.


On May 09 04:18 PM Timonomics wrote:

> I agree with Bill Gross of PIMCO, the Fed won't allow the long bond
> yield to get beyond the current 30-year mortgage rate of about 4.8%.
> That means the Fed will increase their treasury buy-back Ponzi scheme
> to well beyond the existing $300 billion either after or before the
> current deadline of August 31, 2009. If that is true, mortgage rates
> won't jump that much, but with a slow economic recovery, investors
> may jump at the fixed rate of close to 5% on long-term treasury bonds
> as opposed to the slippery, uncertain returns on equities.

Wall Street Breakfast: Must-Know News

The one thing I do know is that we should not have seen hundreds of billions in global equity capital destroyed b/c of a bunch of swine.

Wall Street Breakfast: Must-Know News

Where in the Constitution does it state that bank decisions must be "in the nation's economic interests?" Or maybe repayment terms were included in initial loan agreements?

Positioning for Reflation

Let's caveat your statement by noting this "graceful exit" is anything but benevolent. It is born of necessity as the Chinese will not continue the historic pace of Treasury purchases, and the Japanese are about to have their own current account turn negative. Both our #1 and #2 creditors will be cutting our line of credit in the near future.

The timing of the cut in the line of credit could not be worse, with the President's budget projected to be $9.3 trillion in deficit over the next decade.


On Mar 22 02:38 PM northstar10000 wrote:

> The Fed just cut a deal with China so they can gracefully exit our
> bonds via limited future purchases and mild liquidation. Sorry if
> you think they did it to keep rates low for us the poor americans.
>
> Fooled again partner.

Credit Card Cancer

Our culture is largely shaped by federal policies encouraging consumerism and relying on credit. Congressional policies, HUD, tax preferences for consumption and debt, all the way down to Federal Reserve monetary policies warp society and destroy conservative fiscal values.

Credit Card Cancer

Incredible that as the federal government is spending trillions in deficit it is also sending warships to the waters of our largest creditor, China.

The Chinese PM's comments this week were meant to serve warning to our profligate spending, and for the U.S. to stay out of Chinese affairs.

Debt is ultimately serfdom.

Obsessing About Global Bank Stocks in the Post-Lehman World

The German Cabinet has already set the stage for nationalization:

online.wsj.com/article...

No wonder why DB is falling hard. Ironically, American banks appear to have higher "nationalization premiums" built into prices. Do investors really consider the U.S. more Socialist than Germany?

Wall Street Breakfast: Must-Know News

Note that 30-Year Treasuries peaked in December, reaching 2.519%. This corresponds with the surge in foreign purchases, but note that current prices have declined quite a bit, now yielding 3.52%. This would indicate foreign purchases are trailing off, as expected.

Wall Street Breakfast: Must-Know News

Excellent commentary. Politicians love to come to power in times of "crisis." Doesn't matter that it was caused by politicians, since the incoming ones of course are omniscient and know exactly how to fix everything. The answer is always more regulation, more taxes, and more spending on our behalf. In essence, it is the call to cede increasing power from the individual to public domain. Non of this hog wash will fix anything; rather, it is why we now stand on the precipice...

As far as American's AAA rating...there is no way S&P will downgrade the government's credit rating before the market tears it apart itself. S&P must answer to its masters, and those masters are sitting in Capitol Hill with nice suits spending as much of our money as they can. A credit downgrade would put an inconvenient end to that spending orgy...not likely to happen.


On Jan 14 08:15 AM PrudentMan, CFA wrote:

> Consumer Confidence? Why would anyone be confident in the economy,
> which is only our fifth worst since the end of WWII, when the, Fed
> Administration, Congress and especially Obama all tell everyone it
> is going to get worse? In the previous recessions the government
> pretty much kept their mouths shut and did their job instead of being
> much too vocal
>
> Why are all the Fed members talking so much. In my fifty years as
> a professional investor I never heard so much said by people who
> proved they know so little. If all these rear-mirror economists,
> who are behind the curve, would spend their time doing some analysis
> instead of brushing up their resumes they may have seen the problem
> with credit years ago. Because the non-discounting stock markets
> kept going up all these people were just Pollyandas.
>
> Whey is Obama and Congress so vocal? These Socialists see and opportunity
> in the false "worse receission since the Great Depression, and I
> lived in that time that was exacerbated to unnecessarily last ten
> years, they can make the greatest theft of taxpayer money in history.
> As we all know, those who have the money have the control.
>
> If the Fed Congress and the Administration would have said that the
> Free Market will work things out so property will revert to their
> rightful owner this recession would be over. The promise of bailing
> out loser at the cost of winners is very far from Free Market Capitalism
> as it is Socialist Capitalism. Are problems started decades ago
> and the Fed and Congress could very easily have reighned it in with
> the laws on the books.
>
> I think this is the best time for rational investors support and
> end encourage Congressional Term Limits.