Interesting times: Spanish rates below U.S.


The yield on Spain's 10-year government paper slips nearly 5 basis points to 2.595% today, compared to 2.62% for U.S. 10-year Treasurys.

In this, Spain has joined Ireland, whose 10-year notes yield less than 2.50%. Italy at 2.72% has yet to join the party. Greece? Its 10-year notes trade at 5.78%.

Comments (7)
  • Paulo Santos
    , contributor
    Comments (34830) | Send Message
     
    The massive money printing is distorting every market to incredible extents.
    9 Jun 2014, 08:12 AM Reply Like
  • MartinGale7
    , contributor
    Comments (207) | Send Message
     
    Strange but not half as strange as Japanese 10 Year JGBs at 0.60%.

     

    It is nearly undeniable that 10 Year JGBs have greater issuer risk than 10 Year Treasuries. If in doubt look at the %Debt/GDP.

     

    It is nearly undeniable that in 10 years time, when the principal is repaid, USDs will have weakened less than JPYs. If in doubt look at the way Abe is monetising public debt and trying to debase JPY currency as fast as he can.

     

    No one seems to understand credit risk or basis risk these days.

     

    We do live in interesting times indeed.
    9 Jun 2014, 08:46 AM Reply Like
  • John Georgiou
    , contributor
    Comments (234) | Send Message
     
    Very good aspirin. But problems get solved with GOVs ...not from ECB.
    9 Jun 2014, 09:03 AM Reply Like
  • The_Hammer
    , contributor
    Comments (5092) | Send Message
     
    The system is fake. Got people believing that this is how it should work and praising the CBers who are pushing it to the limit.
    9 Jun 2014, 09:55 AM Reply Like
  • MartinGale7
    , contributor
    Comments (207) | Send Message
     
    Yes. They don't understand causality. For example, we all know that deflation usually occurs during an economic contraction. History tells us this and there is no argument about it. However Keynesian economists see this and think that deflation is the cause of economic downturn whereas deflation is actually the medicine that helps an economy heal. Deflation is the cure – not the cause. When you have blown your credit cycle too big too quickly, you need to let prices find a lower level as you deleverage.
    9 Jun 2014, 10:31 AM Reply Like
  • FreeMktFisherMN
    , contributor
    Comments (463) | Send Message
     
    actually the late 19th and early 20th century were periods of great growth AND falling prices, as productivity skyrocketed and standards of living did, too. Stronger dollar each year, backed by precious metals. So the two do go hand in hand. Deflation is healthy and desirable as opposed to inflation which only benefits reckless borrowers and usurious leeches.
    9 Jun 2014, 02:04 PM Reply Like
  • andrewtoney
    , contributor
    Comments (100) | Send Message
     
    Spanish rates below 10 Yr Us Treasuries are not really surprising;the party has just begun.Regards.
    9 Jun 2014, 01:48 PM Reply Like
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