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Should Bernanke unveil something like "Operation Twist," long-term Treasury buyers could be...

Should Bernanke unveil something like "Operation Twist," long-term Treasury buyers could be looking at lower returns going forward. Risk-averse investors have poured billions into Treasury funds such as TLT this year, helping Treasuries sharply outperform both investment-grade (LQD) and high-yield (HYG) corporate debt.
Comments (5)
  • He's already doing it, my god look at the long end, look at gold.

     

    DUH!! #WINNING!!
    24 Aug 2011, 02:11 PM Reply Like
  • don't get it. Flat yield curves lead to recessions.
    24 Aug 2011, 02:17 PM Reply Like
  • When you want to scare money out of t's and gold and into equities, this is what you do. He has already said at the last meeting, the economy will suck for the next 2 years. IE low yeilds.

     

    We never left the recession anyway, so no difference other than the banks were pumped with QE 1&2.

     

    This is not what they want to hear.
    24 Aug 2011, 02:22 PM Reply Like
  • "Flatten the curve"
    Is he (Bernanke) going to flatten the curve by bringing the long term also down or by bringing the short term up? I suppose in the real world it would be a combo of the two.
    What makes him to think I (other gullible folks might) would buy those low interest long term bonds or the stocks (using the convoluted argument that they look cheap w.r.t to bonds!)? I would rather sit on cash (yes, that is also foolish, but seems the least risky given the circumstances. I will not regret since I had all my money in Gold, GDX, rode the gold train from 300 to 1200 and got out because I expected the 4 T$ or so we spent in 2009 to boost the real economy for at least a coupe of years and hence bring the gold down temporarily. As we know, all that money basically created another stock bubble with no benefit to the economy and hence Gold took off as well and he wants to create a bigger bubble) and keep looking for alternates or wait for that crash (which has to occur sooner or later). I am not GOD to buy at the absolute minimums and sell at the absolute maximums, but at least I won't loose my shirt by expecting all these Fed manipulations would succeed. The time for that has come and gone (remember the mantra, "Don't fight the Fed"!
    24 Aug 2011, 02:45 PM Reply Like
  • Shanghai raised margins 26% two days ago. This is normal for gold.
    In fact it is perfect. No worry's, the twist didn't work very well in 61, today will be no different. Last bullet.

     

    This is a structual issue, nothing will change the outcome of the cycle.
    24 Aug 2011, 03:32 PM Reply Like
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