The sharp drop in treasury prices turns into a rout. Capped by an increase of 21 basis points...


The sharp drop in treasury prices turns into a rout. Capped by an increase of 21 basis points today, the yield on the 10 year has risen a staggering 116 basis points to 3.49% in the space of two months. QE may or may not be working, but higher rates cannot be helpful to the housing market.

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Comments (14)
  • Burning Madolf
    , contributor
    Comments (200) | Send Message
     
    It would seem this story was deserved of more attention.
    14 Dec 2010, 04:23 PM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2213) | Send Message
     
    Now they are going to say it would have been worse without them.
    14 Dec 2010, 04:23 PM Reply Like
  • woollyB
    , contributor
    Comments (1019) | Send Message
     
    Ah yes, the justification for every government intervention and its inevitable failure. The war on drugs, the war on terror (started 1998), the Great Society legislation to make houses and doctors more affordable, federal student loans to make college more affordable ... it never ends. We get the opposite of the intended result and they say it would have been even worse.
    14 Dec 2010, 04:58 PM Reply Like
  • apberusdisvet
    , contributor
    Comments (3055) | Send Message
     
    But But But...............Didn't Ben say he was 100% confident of his actions? I'd hate to be around when he's only 50:50.
    14 Dec 2010, 04:28 PM Reply Like
  • bbro
    , contributor
    Comments (10932) | Send Message
     
    All we are missing is Ron Paul to get real power and then we will
    have real depression....
    14 Dec 2010, 04:40 PM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2213) | Send Message
     
    Should the "efficient markets" anticipate that?
    14 Dec 2010, 05:05 PM Reply Like
  • megaballs
    , contributor
    Comments (45) | Send Message
     
    I maintain the Fed is adding liquidity by buying 5-7 year US Treasuries and not specifically trying to lower intermediate term rates.
    The rise in yields can be spun as a sign of greater economic strength, which is the goal of liquifying the system.
    Normally rates are adjusted by using Fed Funds rates, but that pistol has been shot.
    14 Dec 2010, 04:49 PM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2213) | Send Message
     
    I maintain that the market will do whatever it wants regardless of what the Fed wants. Pundits, however, will justify WHATEVER happens using one of the economists' hands.

     

    If rates go up, it is good, if they go down it is good. Bernanke says he wants rates down but not really.

     

    c'mon man! Either this is a hard science or it isn't. If it isn't we just admit we don't and go forward.
    14 Dec 2010, 05:08 PM Reply Like
  • bbro
    , contributor
    Comments (10932) | Send Message
     
    Forward eurodollar curve reflects a belief in a strong economy....
    14 Dec 2010, 04:49 PM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2213) | Send Message
     
    Or lower credit or higher inflation. Or both.

     

    You DO NOT KNOW what eurodollar curve reflects because it does not speak. All you know is that commonly believed about the eurodollar curve.
    14 Dec 2010, 05:10 PM Reply Like
  • bbro
    , contributor
    Comments (10932) | Send Message
     
    And that is what I love...your belief makes markets...place your bets gentlemen...
    15 Dec 2010, 02:51 AM Reply Like
  • Harry Tuttle
    , contributor
    Comments (2213) | Send Message
     
    Exactly bbro, "BELIEF". Which is different from logical conclusion.

     

    All the best to you.
    15 Dec 2010, 09:00 AM Reply Like
  • Duude
    , contributor
    Comments (3405) | Send Message
     
    Of course the Fed isn't about to end QE2. They'll just double down on stupid. I'm afraid Bernanke the historian has been reading old German economic books on how to bring a country down in 10 easy steps.
    14 Dec 2010, 04:55 PM Reply Like
  • Econdoc
    , contributor
    Comments (2938) | Send Message
     
    This screams growth and upside surprises on GDP and jobs in 2011.

     

    For inflation - you need capacity to be contrained and bank lending to pick-up strongly. Last I looked we still had about plenty of excess of capacity and people unemployed and underemployed.

     

    Who cares about housing? It is not relevant.

     

    QE2 is to growth program. That was/is the intent. And Bernanke will have saved the world.

     

    Bernanke for President of the World.

     

    You know World Government is coming. You know that's the next step. You know Obama is signing the papers as we speak and the Illuminati are quietly gathering. Why do you think he is meeting with Buffet and Gates. They are in the club. Soros too. Goldman are the bankers. They will own it. World Government. A socialist cabal. Dogs and Cats living together...

     

    We need Ron Paul and Sarah Palin to save us.

     

    Palin Beck 2012. Run for your lives.

     

    E
    14 Dec 2010, 06:41 PM Reply Like
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