Bank loans have already seen strong performance for most of this year, this is after getting slammed last year. There’s still positive technicals in the mkt: hy issuance to pay off loans, little to no new issuance beyond that so better secondary demand. Default rates are still elevated though. If you’re looking for an inflation hedge, any type of floater might not help since a chg in short term rates is based on a number of factors, only one of which is inflation.
BiPolarBoyBoston Wrote: ------------------------------------------------------- > Ok, i’ve been watching TBT and prices/yields on > long term bonds. > > Why have prices on long term treasuries been > rising when the market is pricing in a small > recovery? > > Dollar has been mixed and commodities rebounded > slightly. Still no signs of inflation. > > Why are people still buying these long date > treasuries? Stock Investors are foreseeing a recovery, but Bond Investors are not. Usually Bond investors are considered more savvy. So, I wont be surprised if stock markets fizzle out by end of this year or early next year.
One week later, People can’t get enough of 30 year treasuries nor can they get enough of equities. What is happening here?
Auction was stronger than expected, in contrast to the past few 30yr auctions/refundings. Some guys probably had some steepeners on going into 1PM and got caught offsides. GUess appetite for the long end is pretty solid.
when the currency speculators ride in swords drawn to discipline the U.S. all this will unwind. be prepared.