InTheMoneyStocks'  Instablog

InTheMoneyStocks
Send Message
  • Yields Spike: Screwing The Fed One Tick At A Time 0 comments
    May 28, 2013 12:39 PM | about stocks: TBT

    The music in the game of musical chairs can only go on for so long. When the music stops, $hit hits the fan. We may be seeing that today with yields jumping dramatically higher. The 10 year yield is trading at 2.12, +0.10 (+5.17%). This is the highest in over a year and could literally handcuff the Federal Reserve and their massive printing of money campaign.

    When interest rates rise like today, borrowing money gets much more expensive. Cheap money is the main reason the Federal Reserve has been able to print so much with so little short term consequences. In addition, this feeble economic recovery is based on cheap money. That is why housing is doing so well right now. Any uptick in interest rates will hurt home prices and sales dramatically.

    When interest rates rise, the Federal Reserve will have no option but to curtail their quantitative easing policy. Higher interest rates will make the economy struggle again. Tick tock, tick tock.

    The Federal Reserve may not have a choice in stopping their printing presses if this continues. When time is up, time is up.

    Gareth Soloway
    InTheMoneyStocks.com

    (click to enlarge)

    Stocks: TBT
Back To InTheMoneyStocks' Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers

StockTalks

  • And he just closed out another one, $DUST for +7.55% in the Research Center... inthemoneystocks.com/investor.
    Jul 20, 2016
  • Gareth sold his $JDST in the Research Center here: http://bit.ly/ActiveInvestor. Profit earned = +12.5%. Congrats members!
    Jul 20, 2016
  • $IWM negative already on the day. Small cap warning signal?
    Jul 20, 2016
More »

Latest Comments


Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.