John McLeod

The New Bull Market Fallacy

"... so they could sell equity into the rally before the next huge wave down." -- that's the punchline of this joke, no?

Technical quibble: "She states: // Flash orders are also called ..." I think you forgot to "blockquote" that para.

Yikes! My head hurts. We've been following the NY Fed's numbers on foreign central bank holdings of Treasury and Agency debt (a key support for all those US stimulus programs):

a) since start '09 the agencies number has not been credible

b) (related to a) since start '09 Fed has bought for its own account over 1/2 $trillion of agencies -- never previously owned any -- and every last MBS has maturity beyond 10 years. This in an era when long treasuries investors have taken a 25% haircut.

c) foreign central banks' reported buys of treasuries have gyrated repeatedly from near-record amounts one week to virtually nothing the next

d) the definition of "indirect buyer" changed in June, so reported record participation by cenbanks in ongoing treasuries auctions has become suspect

... bottom line, the debt markets are looking as weird as the equity markets. But at least they will get some relief when this idiotic bear rally collapses ;-)