So what's the Fed going to do?
- Thread starter The Kin
- Start date
The only way the banks are going to be able to recapitalize is by riding a yield curve that is as steep as possible. So I think they do 100bp cumulative in the next couple of weeks.
Look at the breakeven on the TIPS. The have collapses recently. I'm not bond expert, but even if you make allowances for liquidity constraints, the market is saying inflation is not a concern -in fact it's almost as if those bonds are pricing in the slim chance of DEflation.
Look at the breakeven on the TIPS. The have collapses recently. I'm not bond expert, but even if you make allowances for liquidity constraints, the market is saying inflation is not a concern -in fact it's almost as if those bonds are pricing in the slim chance of DEflation.
$0.02
Whatever they do doesn't mean anything right now. I voted lower by 25bp because they can take this opportunity or not. If they go the other way, check for brake marks!!!
Either way one thing is for sure:
1. liquidity = print more dollars
Which means:
2. short this dollar rally short term
Which incorporates:
3. Play at your own risk
Enjoy,
You could also have your orders in short asia and europe, long dow & snp as a hedge on the bounce/hedge on asia (subject to change).
Also, Fed has cash from petrodollar return from the high oil prices the last year+ (treasury/petrodollar exchange business)...anyone watch the 10-yr yield??
Whatever they do doesn't mean anything right now. I voted lower by 25bp because they can take this opportunity or not. If they go the other way, check for brake marks!!!
Either way one thing is for sure:
1. liquidity = print more dollars
Which means:
2. short this dollar rally short term
Which incorporates:
3. Play at your own risk
Enjoy,
You could also have your orders in short asia and europe, long dow & snp as a hedge on the bounce/hedge on asia (subject to change).
Also, Fed has cash from petrodollar return from the high oil prices the last year+ (treasury/petrodollar exchange business)...anyone watch the 10-yr yield??
No.
Things are too far gone.
Bernanke has moved past interest rate policy and into new territory. The old game no longer works, so a new game plan is being re-written as we go along.
Remember that spike in the 30 yr treas last year in the summer that heralded the credit crisis and ended the goldilocks economy? Had to be a veiled threat from china.
No rate cut. Hope I'm wrong 'cause I am long treasuries (disclosure) but don't expect a rate cut.
Things are too far gone.
Bernanke has moved past interest rate policy and into new territory. The old game no longer works, so a new game plan is being re-written as we go along.
Remember that spike in the 30 yr treas last year in the summer that heralded the credit crisis and ended the goldilocks economy? Had to be a veiled threat from china.
No rate cut. Hope I'm wrong 'cause I am long treasuries (disclosure) but don't expect a rate cut.
Rate cut means nothing if the banks won't even lend to each other.
The big event is if AIG can get that $75 billion by tomorrow night.
Another boat ride tomorrow!!
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The big event is if AIG can get that $75 billion by tomorrow night.
Another boat ride tomorrow!!
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