If the Fed announces a new QE program this afternoon, one could do worse than selling Treasurys....

If the Fed announces a new QE program this afternoon, one could do worse than selling Treasurys. Bond yields have rallied sharply (very cool graphic here) after the past two QE efforts were launched.  It was only after the Fed closed shop on its purchases that yields resumed sliding. It's simple, says Jeff Gundlach: QE is stimulative, therefore one should expect yields to rise while it is ongoing.

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Comments (4)
  • Hitesh Patel
    , contributor
    Comments (314) | Send Message
    It sure does stimulate the price of food and gas. I hope they annouce a trillion dollar QE program so we can fix the US economy once and for all
    13 Sep 2012, 10:53 AM Reply Like
  • Swass
    , contributor
    Comments (419) | Send Message
    It is ironic that they claim the point of QE is to lower borrowing rates. That was always counter-intuitive to me anyway, since the expectation of inflation would rise with QE, thereby increasing what investors command in yield.
    13 Sep 2012, 12:02 PM Reply Like
  • fred1724
    , contributor
    Comments (67) | Send Message
    More dollars from thin air. Eventually .. . . . . . . . .
    13 Sep 2012, 03:42 PM Reply Like
  • don2m
    , contributor
    Comments (128) | Send Message
    Another rather large contract was let this morning also. 3 in 1 oil supply. The printing presses are going to need a lot of it as they will now be working overtime and we can't afford to have them squeaking as it will keep some in Washington awake!
    14 Sep 2012, 09:12 AM Reply Like
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