Another Trade of a lifetime - long treasury bonds (and T Notes)

N

Nighthawk

If you believe inflation is here to stay, don´t read any further.

Current 10yr yield: 3,78%.

FED, ECB, BOC, BOE, SNB doing all in their power to destroy economic activity and jobs after years of complaining about "deflation".

Copper, crude oil already indicating what´s coming: the famous "R word".

Germany´s final GDP revision today for Q1: -0,3%. China doing exceptionally bad without real estate boom.

Entering first long position and buying some AAA (still "AAA") US government paper. I will hold until we reach next year 2,91%. At least.

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MAYBE right;
copper is going up+ UP nicely in non front months. Looks like longer term copper uptrend forecast [not prediction]maybe right, uptrending .
Haven't had tie to look @Us gov paper waste lately/nice long term uptrending copper; sold some cash copper this week.............................................. :caution::caution:
 
Current 10yr yield: 3,78%.
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I've already been slowly accumulating long-term Canadian Fed bonds while they are on fire-sale for many weeks. And they're trending lower still.

The problem, is I would much more prefer to sink all deployable cash into the REITs which are also tanking hard. Office reits have a very high risk-reward play right now.

So many discounts all over the place right now, too many options!
 
The_Krakenite said:
The problem, is I would much more prefer to sink all deployable cash into the REITs which are also tanking hard. Office reits have a very high risk-reward play right now.
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I don’t know a single person in any business that goes to an office more than 3 days a week.
At least half of them haven’t been to an office since Covid began and most likely won’t ever return.

The only “office REIT” I would buy is ARE. They aren’t a true office REIT but they have been lumped in with the selling.
It still has more downside but it’s on my radar
 
Clubber Lang said:
I don’t know a single person in any business that goes to an office more than 3 days a week.
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Well, that should be good for office REITs.

They can rent out those offices to some other tenant the other two days a week. They will be able to collect rent from two different tenants for the same space. Revenue will increase by 40%, with no significant increase in expenses.

;)
 
Nighthawk said:
If you believe inflation is here to stay, don´t read any further.
More...

The Fed has brought real interest rates marginally positive... but with the other hand they're printing mountains of cash to pay IOER, which unlike QE is straight up injection of cash to the bank account rather than an asset swap. They're also printing hundreds of billions more by handing out round dollars for collateral (T-bonds) worth seventy or eighty cents.

It's far from clear that we are anywhere close to beating inflation. The negative carry (in real terms) is modest, at least.
 
TLT will break 100 soon, not a trade of life time yet.

Once the debt ceiling passes, Treasury will print 1 trillion immediately, about 600 billion will be used to roll outstanding bonds, 400 billion will be used to pay for spendings.

Bond price will be depressed for a while, market liquidity will be drained considerably. Recession is likely to follow.

But of course, you can always eat AI.
 
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