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It's an old and rather tired academic debate. I don't wish to participate in it, to be honest. One thing worth mentioning is that the Fed, unlike the ECB and the BoE, has a dual mandate, so they don't exclusively target inflation.

It makes total sense. The front end should rally as a result of longer tenor tenders. The impact of the covered bond on the long end is unclear, which argues strongly for a steepening.

It's not entirely clear that this is a slam-dunk and will make things a lot better. Inflation targeting has a few flaws...

Well, LIBORs are going down like there's no tomorrow, so this isn't over.

Yes, you want to look at the on-the-runs, rather than the CTDs, because the CTDs are often shorter tenors (for example, the 10y note CTD at the moment is a 7y bond)

*SEC ALLEGES RMCI, CHAIRMAN OTHERS DIDN'T PROVIDE MATERIAL INFO *SEC ASKING COURT TO COMPEL PRO RATA DISTRIBUTION TO INVESTORS WHOA! This is an interesting development...

Another detailed look at the current Muni issues: http://www.acredittrader.com/?m=200905

In the best possible case, inflation is a mechanism to forcefully take money from cash-rich savers and channel this money into productive activity, thus spreading the cost of economic progress across a wider constituency. However, the most probable outcome is that savers get screwed and nothing...

Nah, the actual bond is in brackets, that's all... Nothing to do with CTD.

Yes, yield of the current 2y on-the-run UST (0 7/8 Apr 11s) vs yield of the current 10y on-the-run UST (2 3/4 Feb 19s).

Looks like they're talking about 2s10s, i.e. yield on current 10s vs the current 2s.

"Zere iz no threat of deflation. Vi are currently vitnessing a process of disinflation..."... So says Muscles from Frankfurt, so don't you peeps worry your pretty little heads.

Lots of questions there... Q1: The spread referred to here is the difference between the AAA bond yield and the comparable govt bond yield. Simplistically, the lower the yield spread of a risky asset (like the AAA bond) over a govt bond, the less risky and the more like a govt bond it is...

You need to compare apples with apples... The idea your professor is trying to convey is that there comes a point in the life of an American option, where exercising the option and holding the underlying to the expiry date is actually more advantageous than holding the option to the expiry...

If you assume that inflation is accompanied by a weak dollar (not an unreasonable assumption), EURUSD should perform, if you also assume Mr Trichet is as hard as they say.

That's naive... In the end, Mr Trichet will bend over for Mr Sarkozy et al just as smoothly as any other central banker.

My big problem with the CPI is the OER component, which completely ignores the housing equity that can be monetized. Buy equities, buy commodities, buy TIPS... Have a portfolio of inflation-linked assets. That's my 2c

Totally up to you and depends on what sort of trading you like to do... If you like short-term macro sort of stuff, then outright probably is best. Otherwise, I really don't know. You should play with the two options and see which you're more comfortable with.

Some news... http://www.bloomberg.com/apps/news?pid=20601087&sid=azu2GgdtzJqQ&refer=home http://www.telegraph.co.uk/finance/personalfinance/investing/gold/5201921/Gold-Inflows-into-ETFs-up-by-more-than-300pc.html How 'bout them apples?

I guess that was my 4c, actually :)