JGBT
DB 3x Japanese Govt Bond Futures ETNNYSEARCA
JGBT is defunct since September 19, 2016. This ETN was called on 9/19/16
  • Thu, Sep. 22, 10:20 AM
    • "We've all relied too much on monetary policy," says Third Point's Dan Loeb, mostly positive on the BOJ's latest bright idea, but noting corporate and fiscal reform is what's really needed to revive growth in Japan. "They used to call it the punch bowl. I say we've got to take the crack cocaine pipe away and start focusing on real fiscal policy and structural reforms."
    • An investor in Japan for years, Loeb says foreign money is being welcomed more now, and that's a good thing. He and Japanese investors both want the same things, he says - Better-run businesses whose benefits will spread "far and wide." However, he cautions against government protection for certain sectors: "Let the market determine where workers' labor is best allocated, let people who allocate capital determine that."
    • Checking the scorecard, post-BOJ, the JGB yield has returned to negative territory and the yen (NYSEARCA:FXY) continues to strengthen, with dollar/yen -0.5% and threatening to dip below ¥100.
    • ETFs: FXY, YCS, JGBS, JGBD, JYN, YCL, JGBL, JGBT, JGBB
    | Thu, Sep. 22, 10:20 AM | 16 Comments
  • Wed, Sep. 21, 7:36 AM
    • The Bank of Japan's latest gambit to try and restore growth and inflation to the country is being dubbed "yield-curve control." The bank will abandon its focus on the monetary base, and instead aim to keep 10-year JGB yields from falling into negative territory (where they've been since March), and overshoot the 2% inflation target.
    • The steeper yield curve, hopes the BOJ, will encourage banks to lend and consumers to borrow.
    • After a generation of failed BOJ policies, some analysts are naturally cynical. "Committing to 'overshoot' 2% inflation rings hollow if you can't get there in the first place," tweets DailyFX's Ilya Spivak.
    • While the Nikkei climbed 1.9% following the news, and the 10-year JGB yield pushed into positive territory for the first time since March, the yen - which initially fell - has moved higher. Dollar/yen is down 0.35% at ¥101.33.
    • ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, DBJP, JYN, JPNL, EZJ, JEQ, EWV, HEWJ, YCL, JPXN, JGBL, JGBT, JGBB, FJP, JPN, HGJP, HFXJ, HJPX, DEWJ, FXJP, GSJY, JPNH
    | Wed, Sep. 21, 7:36 AM | 7 Comments
  • Fri, Sep. 16, 8:00 AM
    • The team has moved to underweight on bonds over the next three months, and expects the yield on the 10-year U.S. Treasury to hit 2% by year-end (currently 1.66%). Yields on 10-year German and Japanese paper are forecast to hit the towering levels of 0.3% and 0.1%, respectively.
    • Goldman: "The Goldilocks scenario from July and August, with anchored global rates and better-than-expected macro data, has faded. Moreover, since mid-August pressure on commodity prices has increased again."
    • ETFs: TBT, TLT, TMV, TBF, EDV, TMF, TTT, ZROZ, JGBS, JGBD, VGLT, TLH, SBND, UBT, DLBS, TLO, BUNL, JGBL, BUNT, LBND, GGOV, JGBT, VUSTX, DLBL, TYBS, JGBB
    | Fri, Sep. 16, 8:00 AM | 5 Comments
  • Tue, Sep. 13, 2:10 PM
    • There's no flight-to-safety bid for Treasurys as equity markets tumble today. In fact, it's just the opposite, with the 10-year yield leaping by another seven basis points to 1.73%. TLT -1%, TBT +2%
    • The rout is global in nature, with the German 10-year Bund yielding all of 7.6 basis points after a 3.8 bp rise today. Even the 10-year JGB yield is threatening to go positive.
    • The move isn't necessarily about tighter Fed policy as short-term rate traders are pricing in very little chance of a rate hike next week. and only a 50% chance of a move by year-end.
    • U.S. stock indices are at session lows, with the Dow off 1.4%, the S&P 500 1.5%, and the Nasdaq 1.2%.
    • ETFs: TBT, TLT, TMV, TBF, EDV, TMF, TTT, ZROZ, JGBS, JGBD, VGLT, TLH, SBND, UBT, DLBS, TLO, BUNL, JGBL, BUNT, LBND, GGOV, JGBT, VUSTX, DLBL, TYBS, JGBB
    | Tue, Sep. 13, 2:10 PM | 54 Comments
  • Thu, Sep. 8, 2:51 PM
    • This just in: The generation-long bull market in Japanese Government Bonds has gone into reverse for the last two months, bringing the yield on the 10-year JGB up to the astronomical level of nearly 0.7% from about 0.4% in July.
    • Thirty basis points may seem like nothing, but not at these low levels, and the late-summer move is the worst rout in JGBs in a full 13 years.
    • Spooking investors are comments from BOJ Governor Haruhiko Kuroda that the low level of long-term yields is crimping pension and insurance investments. Some believe that while Kuroda will keep the central bank's extraordinary stimulus in place, tweaks could be on the way to drive a steepening of the yield curve.
    • ETFs: JGBS, JGBD, JGBL, JGBT, JGBB
    | Thu, Sep. 8, 2:51 PM | 1 Comment
  • Wed, Aug. 17, 4:40 PM
    • Japan Post Bank and the country's three so-called megabanks have nearly halved their holdings of their country's government paper since the Bank of Japan stepped up its bond purchases in 2013, according to Bloomberg.
    • For the banks, at least, holdings can't go much lower as they need government bonds on their books to serve as collateral in their dealings with the central bank.
    • Japan Post Bank remains the largest holder of government bonds (outside of the central bank, of course), and - recently gone public - it's looking to boost returns by diversifying out of those instruments, thus providing maybe a little more leeway for the BOJ to find sizable amounts of JGBs to buy.
    • ETFs: JGBS, JGBD, JGBL, JGBT, JGBB
    | Wed, Aug. 17, 4:40 PM
  • Wed, Aug. 10, 9:39 AM
    • According to a draft of a "comprehensive" review of its policies set for release next month, the Bank of Japan will take note of a number of factors - big declines in oil prices, a 2014 sales tax hike, and a deflationary mindset among the populace - as keeping the economy from hitting the bank's 2% inflation target.
    • In doing so, the BOJ will be defending itself from criticism that its QQE program (quantitative and qualitative easing) has been a failure, and thus signal markets that more of the same is coming.
    • The leak is important as last month's announcement of a review sent the JGB market to its worst sell-off in three years on fears the central bank might back off from its money-printing.
    • The yen (NYSEARCA:FXY) has backed off of earlier gains, but remains stronger on the session, with dollar/yen slipping 0.65% to ¥101.20.
    • ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, DBJP, JYN, JPNL, EZJ, JEQ, EWV, HEWJ, YCL, JPXN, JPP, JGBL, JGBT, JGBB, FJP, JPN, HGJP, HFXJ, HJPX, JPNH, GSJY, DEWJ, FXJP
    | Wed, Aug. 10, 9:39 AM
  • Thu, Jul. 7, 2:08 PM
    • With $13.4T in Treasury paper out there, the U.S. government bond market is the largest and most liquid one in the world. But at least one fund manager worries whether he'll be able to get his hands on any in some future bull move. "The scarcity factor is there but it really becomes palpable during periods of stress when yields immediately collapse,’’ says Christopher Sullivan. "You may be shut out of the bond market just when you need it the most.’’
    • Source: Min Zeng and Christopher Whittall in the WSJ
    • The Fed owns more than 20% of all Treasury debt outstanding, a near-double since before the financial crisis.
    • Meantime in the U.K., the BoE owns about 25% of that country's debt; the BOJ more than 33% of Japan's paper; the ECB about 15% of Germany's bonds.
    • Toss out paper with negative yields (20-year JGBs just went below zero), and there's not a lot of high-grade, positive-yielding paper out there. Those feeling the pinch the most are pension funds and life insurance firms. For this reason, money manager Nigel Jenkins expects any rise in bond yields to be quickly met with a wave of buying from the yield-starved institutions.
    • ETFs: IEF, PST, JGBS, JGBD, IEI, TYO, UST, PLW, DTYS, VGIT, GOVT, BUNL, TBX, SCHR, FTT, ITE, JGBL, GSY, BUNT, TYD, DTYL, GGOV, EGF, JGBT, DFVL, JGBB, TAPR, TBZ, DFVS, TYNS
    | Thu, Jul. 7, 2:08 PM | 1 Comment
  • Wed, Jul. 6, 3:16 AM
    • With the pound in decline and investors flocking back to safe-haven assets, the yen rose overnight to around 100.75 to the dollar.
    • "It's back to double digits for dollar/yen? I think this is a pretty precarious level, and if we break through 100, we should start to hear some rumblings from officials," said Bart Wakabayashi of State Street Global Markets.
    • In addition to the surging currency, Japan's 20-year government bond yield fell below zero for the first time ever and the 30-year was just 0.015%.
    • ETFs: FXY, YCS, JGBS, JGBD, JYN, YCL, JGBL, JGBT, JGBB
    | Wed, Jul. 6, 3:16 AM
  • Tue, May 3, 7:22 AM
    • via Goldman Sachs:
    • "Seen in isolation, last week’s decision by the Bank of Japan (BoJ) to stay on hold is understandable. After all, the January move into negative rates produced a massive flattening in the JGB yield curve, exceeding anything seen in Apr. 2013 or Oct. 2014. We therefore have some sympathy for Governor Kuroda who said in the press conference that “we decided to watch the effect of QQE with negative rates this time.”
    • "But this meeting did not happen in isolation...
    • "Our view going into last week was that the BoJ needed to grab the bull by the horns and dispel the notion that it is running “out of bullets.” We thought it could do this by shifting the emphasis back to balance sheet expansion by, for example, taking concrete steps to lift housing loans off banks’ balance sheets, something Governor Kuroda floated in a recent speech. Instead, the BoJ seemed intent on teaching the markets to be “patient,” downgrading the inflation forecast yet again while taking no action.
    • "This is a fateful miscalculation in our view. Unconventional easing is above all an expectations game, where it is necessary to shock markets again and again, until they have no reason to question a central bank’s commitment to its inflation target. Preaching “patience” is the opposite, telling markets they expect too much. There is little doubt in our minds that $/JPY will keep falling in the near term, until Governor Kuroda is forced to respond with overwhelming force. We therefore hold to our structural view that $/JPY ultimately will go a lot higher. But in the short term, it will fall.
    • ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, DBJP, DFJ, JYN, JOF, JPNL, DXJS, EZJ, JEQ, EWV, HEWJ, YCL, SCJ, JPXN, JSC, JPP, JGBL, JGBT, DXJH, JGBB, QJPN, JHDG, DXJF, JPMV, FJP, DXJR, DXJT, JPN, DXJC, HGJP, JDG, HFXJ, HEGJ, HJPX, FXJP, JPNH
    • Now read The Yen's Riddled Road To 100
    | Tue, May 3, 7:22 AM | 5 Comments
  • Thu, Apr. 28, 3:27 AM
    • The Nikkei has slumped and the yen has jumped after the Bank of Japan surprisingly held off from increasing its monetary stimulus as it looks to take more time to understand the effect of its negative interest rates.
    • The Nikkei is -3.6%, while the dollar is -3.2% at 108.27 yen.
    • Specifically, the BOJ let three key easing tools unchanged: its ¥80T ($732) target for expanding the monetary base, mostly through buying government bonds; the 0.1% negative interest rate; and a program to purchasing riskier assets such as stocks.
    • The BOJ also put back to 2017 its timeframe for achieving its target of 2% inflation, the fourth delay in about a year.
    • The BOJ's lack of action comes despite the strengthening of the yen over the recent period - aside from today - and inflation not picking up.
    • Data today showed that March CPI fell 0.1% on year vs +0.3% in February. Core CPI, excluding fresh food, dropped 0.3% after being flat.
    • BOJ Web site
    • Inflation Report
    • ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, DBJP, DFJ, JYN, JOF, JPNL, DXJS, EZJ, JEQ, EWV, HEWJ, YCL, SCJ, JPXN, JSC, JPP, JGBL, JGBT, DXJH, JGBB, QJPN, JHDG, DXJF, JPMV, FJP, DXJR, DXJT, JPN, DXJC, HGJP, JDG, HFXJ, HEGJ, HJPX, FXJP, JPNH
    | Thu, Apr. 28, 3:27 AM | 9 Comments
  • Wed, Apr. 20, 8:00 AM
    | Wed, Apr. 20, 8:00 AM | 1 Comment
  • Sat, Apr. 16, 4:39 PM
    • via Barclays: "A major earthquake struck last night in Kumamoto, but did not trigger a tsunami or nuclear accident – the biggest factors exacerbating damages at the time of the 2011 Great East Japan Earthquake – so any effect on the Japanese economy appears likely to be limited. Our outlook for the market is unchanged.
    • "However, some factories in the region may halt operations. Given the sophistication of supply chains in manufacturing, damages at any one factory could still have a widespread effect.
    • "The market has already been monitoring the possibility of the Abe administration compiling a large-scale package of emergency economic measures in May-June and postponing the consumption tax hike scheduled for April 2017. With the earthquake, this possibility may have increased and an announcement could come earlier. There may also be a stronger possibility that he delays the tax hike without dissolving the Lower House and calls a general election to seek a mandate from the Japanese public. In any case, it is still difficult to gauge the earthquake damages at this stage. However, they do not appear to be anywhere near the scale of those resulting from the 2011 Great East Japan Earthquake."
    • ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, DBJP, DFJ, JYN, JOF, JPNL, DXJS, EZJ, JEQ, EWV, HEWJ, YCL, SCJ, JPXN, JSC, JPP, JGBL, JGBT, DXJH, JGBB, QJPN, JHDG, DXJF, JPMV, FJP, DXJT, DXJR, JPN, DXJC, HGJP, JDG, HEGJ, HFXJ, FXJP, JPNH
    • Now read The Only Thing Rising In Japan Is The Yen »
    | Sat, Apr. 16, 4:39 PM | 16 Comments
  • Fri, Apr. 8, 5:43 AM
    | Fri, Apr. 8, 5:43 AM | 1 Comment
  • Sun, Mar. 27, 6:05 AM
    • Foreign investors' ownership of Japanese T-bills climbed 9.5 percentage points in Q4 to 49% - the highest concentration on record. This despite the introduction of negative rates by the BOJ.
    • Here's why (via Bloomberg):
    • The Japanese T-bill that matures on May with a par value of 10M yen traded at 100.029 on Feb. 16, one day after it was issued. Buyers will get less than what they paid when it is redeemed at par on maturity.
    • A global investor who bought the security at that price would have bought 10.0029M yen at then USD/JPY spot-market rate of 114.07; to hedge the transaction, they could have simultaneously sold the equivalent of the bill’s face value, to buy $87,904 via 3-mo. forwards at 113.76.
    • This transaction leaves $213 more than the principal; had the investor been paid at the 3-mo. USD/Libor, he would have earned $136.
    • Now read Time To Fire Up Japanese Helicopters »
    • ETFs: FXY, YCS, JGBS, JGBD, JYN, YCL, JGBL, JGBT, JGBB
    | Sun, Mar. 27, 6:05 AM | 11 Comments
  • Thu, Mar. 17, 6:37 AM
    | Thu, Mar. 17, 6:37 AM | 1 Comment
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