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Treasurys extend a big 2-day rally following the FOMC minutes, the 10-year yield off 8 basis...

Treasurys extend a big 2-day rally following the FOMC minutes, the 10-year yield off 8 basis points to 1.71% (after nearing 1.9% yesterday). If the Fed is truly going to launch QE3, bond bulls (and bears) should take note because past QE episodes have sent Treasury prices lower.
Comments (9)
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    Yep, Bill Gross shouldn't short Treasurys again unless he trades the swings.
    22 Aug 2012, 04:30 PM Reply Like
  • Brendan O'Boyle
    , contributor
    Comments (1035) | Send Message
     
    I don't really understand the logic here. The 10-yr yield went up substantially during QE2, why the 2 day rally?

     

    Strangest bull market I have ever seen. It's a scramble to buy a piece of paper that lost 3 full years of coupon payments just from the yield dropping from 1.38% to 1.90%. I just don't understand.
    22 Aug 2012, 06:20 PM Reply Like
  • Chris Bersaw
    , contributor
    Comments (582) | Send Message
     
    Because traders are front running the fed ahead of their assumed renewed bond buying, its a classic buy the rumor and sell the fact trade.
    22 Aug 2012, 07:17 PM Reply Like
  • Andres Rueda
    , contributor
    Comments (174) | Send Message
     
    At these price levels, long-dated T-bonds are the idiot's version of greed - great risk for no reward.
    22 Aug 2012, 11:04 PM Reply Like
  • popmcdan
    , contributor
    Comments (12) | Send Message
     
    Ever considered what would happen if the Fed were the ONLY buyer of US Treasuries.....????
    22 Aug 2012, 07:14 PM Reply Like
  • dieuwer
    , contributor
    Comments (2255) | Send Message
     
    They already own 70% of the entire float.
    23 Aug 2012, 08:22 AM Reply Like
  • Andres Rueda
    , contributor
    Comments (174) | Send Message
     
    The T-bond market has lost all contact with rational thinking. The guys who buy these bonds apparently cannot do basic math. Yields on the 10-yr dropped today to 1.69%. Is anybody who buys this paper actually thinking of holding it for the 10 yr term of the bond, collecting those "juicy" coupons, or is the notion simply to dump it on somebody else (maybe the Fed or the Chinese (?)) down the road? At these low yield levels, a small hike in interest rates (we're talking mere basis points!) crushes the cash flow value of these insanely overpriced bonds.
    22 Aug 2012, 08:05 PM Reply Like
  • pollyserial
    , contributor
    Comments (1055) | Send Message
     
    Not saying I'm a buyer of bonds here but aren't there numerous ways to read today's QE tea leaves and isn't this just testament to that?
    23 Aug 2012, 01:07 AM Reply Like
  • PalmDesertRat
    , contributor
    Comments (2595) | Send Message
     
    took some tlt profits this morning at 125.43
    24 Aug 2012, 09:35 AM Reply Like
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