It's always the big boys who get away with it too huh? If you're a hedge fund with Nobel Prize winners on staff, you get bailed out by the gov or the system collapses, if you're a country that over values its currency and defaults on its foreign debt, you get bailed out by the G7 and get favorable terms negotiated by the IMF. It's suckers like the peasants on the street who can't exchange their pesos for dollars, or tax payers who have to cover the insurance, who get screwed... Go figure...
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Bond rally nearing an end?
- Thread starter gharghur2
- Start date
It's always the big boys who get away with it too huh? If you're a hedge fund with Nobel Prize winners on staff, you get bailed out by the gov or the system collapses, if you're a country that over values its currency and defaults on its foreign debt, you get bailed out by the G7 and get favorable terms negotiated by the IMF. It's suckers like the peasants on the street who can't exchange their pesos for dollars, or tax payers who have to cover the insurance, who get screwed... Go figure...
That's why I like the markets so much, because they are the closest thing to absolute justice.
It seems like forever since flight to quality actually mattered, but bonds appear to be picking up a bid from stock market weakness. Maybe this bid has a flattening bias given inflation uncertainty, but I doubt that inversion will occur.
Also, interesting article in the FT that British traders are blaming dealer's variance swap books for late in the day up/dn moves in stocks. I wonder if yesterday's vicious sell off in SPM6 was variance swap related? Any thoughts Riskarb? Are the dealer books really that large?
Also, interesting article in the FT that British traders are blaming dealer's variance swap books for late in the day up/dn moves in stocks. I wonder if yesterday's vicious sell off in SPM6 was variance swap related? Any thoughts Riskarb? Are the dealer books really that large?
Quote from daddyeaux:
there appears to be a black swan event happening somewhere..
a lot of stuff getting shoved over the side........
U gotta be a bit more specific about things than that...
I'm still structurally short the long end.
While I'm not sure if it is relevant in people's minds, I note that the bank loan CEF floating rate funds remain relatively stable to somewhat bid. Suggests to me that the market does not expect lower short term rates anytime soon.
Quote from JohnL111:
Also, interesting article in the FT that British traders are blaming dealer's variance swap books for late in the day up/dn moves in stocks. I wonder if yesterday's vicious sell off in SPM6 was variance swap related? Any thoughts Riskarb? Are the dealer books really that large?
I didn't see any rally in vols yesterday. I'd doubt the drop was heavily influence by trading in swaps. Vol would be the direct-hedge, although selling futures would indirectly hedge vol-risk.
Daddyeaux,
If you like the longer-term stuff buy the FOB. PIMCO currently has this position on and is continuing to add to it as we hit a pretty nice flattening move. It is as if PIMCO has this rubberband that can stretch to infinity, they will never blow up no matter how many steepeners they put on at these levels or how many 10yr strangles they sell every single month.
If you like the longer-term stuff buy the FOB. PIMCO currently has this position on and is continuing to add to it as we hit a pretty nice flattening move. It is as if PIMCO has this rubberband that can stretch to infinity, they will never blow up no matter how many steepeners they put on at these levels or how many 10yr strangles they sell every single month.
Quote from mcurto:
Daddyeaux,
If you like the longer-term stuff buy the FOB. PIMCO currently has this position on and is continuing to add to it as we hit a pretty nice flattening move. It is as if PIMCO has this rubberband that can stretch to infinity, they will never blow up no matter how many steepeners they put on at these levels or how many 10yr strangles they sell every single month.
I think they're still ok as long as the reward is 100 basis points premium, it'll be a while before that happens thou...