Can the 30 year go to 0% yield?

[Crispy]

I am a straight equity/equity option guy so this is outta my space.

Im sure its very possible...but wouldnt it signal out right armageddon?

What do you debt guys say?

 

[abattia]

http://economics.about.com/cs/interestrates/a/zero_interest.htm

http://dailyreckoning.com/the-impact-of-japans-negative-interest-rates/

http://www.kathylien.com/site/swiss-franc/eurchf-floor-negative-interest-rates-in-switzerland

 

[Martinghoul]

Anything and everything is possible... But US 30y nominal yield at 0% is too much, IMHO.

 

[Crispy]

Quote from Martinghoul:

Anything and everything is possible... But US 30y nominal yield at 0% is too much, IMHO.

Lets say it does. Where does that bring price? 154ish?

 

[DontMissTheBus]

Assuming you are talking about the long bond future:

At 0% yield the CTD of the long bond future should be the T 6 5/8 2/27, which pricing at 0% yield is $201.787364. The conversion factor is 1.0613, so the current front US bond contract should be worth $190.13226.

Not sure where you are getting 154 from?

Quote from Crispy:

Lets say it does. Where does that bring price? 154ish?

 

[Crispy]

Quote from DontMissTheBus:

Assuming you are talking about the long bond future:

At 0% yield the CTD of the long bond future should be the T 6 5/8 2/27, which pricing at 0% yield is $201.787364. The conversion factor is 1.0613, so the current front US bond contract should be worth $190.13226.

Not sure where you are getting 154 from?

Much thanks.

154 was just a wild ass guess. Not my space at all..clearly...