Analysis Topic: Interest Rates and the Bond Market
The analysis published under this topic are as follows.
Sunday, June 15, 2008
Credit Crisis Crushing UK Banks / Interest-Rates / Credit Crisis 2008
By: Nadeem_Walayat
Many commentators in the mainstream have in recent weeks begun voicing the opinion that the credit crisis may be over or the worst of the crisis is behind us -
Jim Reid, a credit strategist at Deutsche Bank, said: "This is a further sign that the actual credit crisis is easing. Anything that is not complete seizure is encouraging." on news of the HBOS £500 mortgage securitisation deal.
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Sunday, June 15, 2008
Bernanke's Strategy of Re-flation to Ignite Economic Growth / Interest-Rates / US Bonds
By: Mick_Phoenix
Welcome to the Weekly Report. Let me take you on a journey to explain what Ben Bernanke said and why he said it. We look at yields, what they are telling us and why we should listen. Finally we show evidence that the carry trade is crumbling. You will require a hot beverage, peace and quiet and probably a light snack. Read full article... Read full article...
Sunday, June 15, 2008
Central Bankers Finally Tightening the Interest Rate Screws on Inflation / Interest-Rates / Inflation
By: Money_and_Markets
Mike Larson writes: Believe it or not, it's finally happening. It's dawning on Federal Reserve policymakers ... and on many other global central bankers from Canada to Asia to Europe ... and beyond. The "it" they're starting to accept?
It's time for tighter monetary policy.
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Friday, June 13, 2008
ECB Calls Bernanke’s Bluff on Defending the US Dollar / Interest-Rates / US Interest Rates
By: Gary_Dorsch
A new member of the British Parliament once solicited the advice of Benjamin Disraeli, the nineteenth century British prime minister, on whether he should speak up on a controversial issue. “Do you have anything to say that has not already been said?” Disraeli asked him. “No,” the man conceded. “I just want the people whom I represent, and the members of Parliament to know that I participated in the debate.” Read full article... Read full article...
Thursday, June 12, 2008
Standard & Poor's Cuts Ratings on 65 classes of Alt-A Securities / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
In a completely expected move (at least in this corner) is yet another S&P downgrade in Alt-A mortgage backed securities .June 11, 2008-Standard & Poor's Ratings Services today lowered its ratings on 65 classes from 19 residential mortgage-backed securities (RMBS) transactions backed by U.S. Alternative-A (Alt-A) mortgage loan collateral issued in 2006.
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Thursday, June 12, 2008
LIBOR Leading Indicator for End of the Credit Crisis and Banking Fiasco / Interest-Rates / Credit Crisis 2008
By: Keith_Fitz-Gerald
How will we know the credit crisis and banking fiasco are truly over?
We won't.
But there's a damn good indicator that will show us the way - the London Interbank Offer Rate , usually referred to as LIBOR.
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Thursday, June 12, 2008
Bernanke Declares Worst of Credit Crisis is Over Before Tsunami Wave Hits / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
I have been staring in amusement at Bernanke's latest proclamation: Danger of downturn appears to have faded . Despite a recent spike in the nation's unemployment rate, the danger that the economy has fallen into a "substantial downturn" appears to have waned, Federal Reserve Chairman Ben Bernanke said Monday.
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Tuesday, June 10, 2008
US Treasury Curve Steepening Bet Blows Sky High / Interest-Rates / US Bonds
By: Mike_Shedlock
Treasury spreads between the 2 year treasury and the 30 year long bond exploded today. This in and of itself is not unusual. However, the way that it happened today was indeed very unusual.Read full article... Read full article...
Monday, June 09, 2008
ECB Signals Hawkish Tone on European Interest Rates as Inflation Soar / Interest-Rates / Euro-Zone
By: Victoria_Marklew
As expected, the European Central Bank (ECB) left its refi rate at 4.0% again last Thursday. What was not expected was the hawkish tone of the subsequent statement and the press briefing from President Trichet. He noted that the Governing Council had a "deep discussion" (trans: "fierce debate"?) and remains "in a state of heightened alertness." Some members apparently wanted a rate hike this month but the consensus was to hold. The President then noted that the Council may decide to make "a small hike" at the July 3 meeting in order to anchor inflation expectations. Read full article... Read full article...
Monday, June 09, 2008
Buy Yield Curive Steeping- Buy Short-term Bonds, Sell Long-term, Bonds / Interest-Rates / US Bonds
By: Levente_Mady
The Treasury market was under pressure most of last week. Then on Friday, with major help from exploding energy prices, the bond market soared as yields across the yield curve dropped significantly. I suppose a pop in the Unemployment Rate from 5% to 5.5% may have helped bonds a little as well. Early in the week our tragic hero Doctor Ben of the Bernanke and Federal Reserve variety told the financial world and anyone else who wanted to listen that the Fed was most certainly done cutting rates and emphatically supports the Treasury's stronger dollar policy. Read full article... Read full article...
Sunday, June 08, 2008
Greenspan Interest Rate Conundrum In Reverse / Interest-Rates / US Housing
By: Mike_Shedlock
There was an interesting chart in the New York Times article Shrinking Lines of Credit . The fact that home lines of credit are shrinking is not really news, nor is the fact that mortgage rates are stubbornly high. I have talked about both of those on many occasions.
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Sunday, June 08, 2008
Signs of the End for Fed US Interest Rate Cuts Are Everywhere / Interest-Rates / US Interest Rates
By: Donald_W_Dony
With inflationary pressures coming out of Pandora's box again, and largely fueled by soaring crude oil prices, is it any wonder that the Fed has stated in its last FOMC meeting in late April that this rate cut was "a close call" and that "any future rate deductions will be closely reviewed". The talk now, coming from Mr. Bernanke, is concern surrounding the low level of the U.S. dollar and inflation. So as the shift in direction has moved 180 degrees from providing stimulus to the financial markets and preventing a recession from taking root to inflation and currency protection. But were there signs of this new direction earlier in the market? From an intermarket perspective, there were plenty of clues by April. Read full article... Read full article...
Saturday, June 07, 2008
Next Phase of the Credit Crisis to Hit Credit Default Swaps $62 Trillion Market / Interest-Rates / Credit Crisis 2008
By: F_William_Engdahl
While attention has been focused on the relatively tiny US „sub-prime“ home mortgage default crisis as the center of the current financial and credit crisis impacting the Anglo-Saxon banking world, a far larger problem is now coming into focus. Sub-prime or high-risk Collateralized Mortgage Obligations, CMOs as they are called, are only the tip of a colossal iceberg of dodgy credits which are beginning to go sour. The next crisis is already beginning in the $62 TRILLION market for Credit Default Swaps. You never heard of them? It's time to take a look, then. Read full article... Read full article...
Friday, June 06, 2008
Downgrades of Monoline Bond Insurers AMBAC and MBIA- The Story No One is Talking About / Interest-Rates / Credit Crisis 2008
By: Andy_Sutton
Shortly after a 200+ point rally yesterday in the Dow Jones Industrial Average we had some big news. REALLY big news. Had this happened a few months ago when everyone was talking about the mere possibility, we'd likely have seen a 4 digit Dow because of it. It is likely that by the time this article reaches inboxes, websites, and blogs around the globe the story will have broken. However, as of market open, Financial Times is the only major site I've found carrying a headline. There are bits and pieces elsewhere, but they are largely buried in small backpage articles. I was lucky enough to see the blurb in the company news of AMBAC only because the stock is on one of my watch lists. Read full article... Read full article...
Thursday, June 05, 2008
Fed Governors Openly Question Ben Bernanke's Competence / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
Open dissent at the Fed continues. I first talked about this a week ago in Infighting At The Fed . Today Lacker Says Fed Loans to Wall Street Risk More Crises . Richmond Federal Reserve Bank President Jeffrey Lacker said the lending to securities firms that the central bank introduced in March may lay the seeds of further financial crises.Read full article... Read full article...
Thursday, June 05, 2008
UK Interest Rate to be Kept on Hold at 5% / Interest-Rates / UK Interest Rates
By: Nadeem_Walayat
The Bank of England Monetary Policy Committee is expected to keep interest rates on hold at 5% at today's meeting. UK inflation hit the Bank of England's upper boundary of 3% CPI in April 08, therefore ruling out the possibility of a further rate cut despite a sharp slow down in economic activity with UK growth on target to hit the Market Oracle forecast of 1.3% for 2008.Read full article... Read full article...
Monday, June 02, 2008
Inflation Sends US Treasuries Sharply Lower / Interest-Rates / US Bonds
By: Levente_Mady
The Treasury market sold off sharply last week. Ongoing weakness on the economic front is taking a back seat to other issues as the 10 year yield broke through the significant 4% barrier. The inflation chatter we discussed last week continued to stay front and center not only in the US but across the globe also as energy prices remained sky high. A key event last week was the poor interest in the Treasury Note auctions that were conducted on Wednesday and Thursday. Both the 2 Year and the 5 Year auctions were met with lousy domestic interest and more importantly a significantly diminished foreign Central Bank sponsorship.Read full article... Read full article...
Wednesday, May 28, 2008
Fed Lending Facility Opens Rift Over Risk Taking Limits / Interest-Rates / Government Intervention
By: Mike_Shedlock
In mid-September the Fed is placing new restrictions on the Primary Dealer Credit Facility, a swap-o-rama with broker dealers as opposed to banks.The Financial Times picks up the story in Investment banks split over Fed loan facility .
Investment banks such as Goldman Sachs (GS) that have been less affected by the credit crisis are said to be leaning against accepting any significant new limits by the Fed, while those that have been somewhat more affected, such as Lehman Brothers, are seen as more eager to maintain access to the Fed facility even if it means new limits on risk-taking.
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Wednesday, May 28, 2008
Surging Inflation Ensures US Interest Rates Headed Higher / Interest-Rates / US Interest Rates
By: Martin_Hutchinson
The inflationary reality that we as consumers have been living for months may finally be starting to dawn on the U.S. Federal Reserve.
The minutes of the last policymaking Federal Open Market Committee (FOMC) meeting, released on Wednesday, showed that the Fed's inflation forecast was raised from a range of 2.1%-2.4% to a range of 3.1%-3.4%.
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Monday, May 26, 2008
Bleak Economic Outlook Positive for Bond Yields / Interest-Rates / US Bonds
By: Levente_Mady
The Treasury market was essentially unchanged last week. As discussed in last week's edition, ongoing weakness in the real economy and renewed turmoil in the stock market are providing solid support for bonds. The event that got the most visible market reaction last week was the release of the FOMC meeting minutes. The Fed reduced economic growth forecasts for 2008 by about 1% from 1.7 to 0.7%. They kept dreaming about 2.5% growth in 2009. As previously mentioned the market does not yet believe that sluggish or no growth will persist, so the Fed downgrade came as a surprise and severely dampened enthusiasm for the stock market while boosting the appeal of Treasury bonds. Our readers who bought bonds and sold stocks on our recommendation from 2 weeks ago were feeling pretty warm and fuzzy. That trade has a bit more upside left, so do not abandon that ship just as yet.Read full article... Read full article...