"Bond Bubble" trade

rffrydr · Posted: Wed Jul 07, 2010 9:34 am Post subject: "Bond Bubble" trade

Huge hedge short in 10yr getting whittled down.

This is one contrarian play I've steered well clear. A "flight to safety" cannot be a "bubble." With FED policy flat for 16mos .60 on a two-year is a good deal. --Still, looking for a bigger move sooner than that.

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rffrydr · Posted: Fri May 06, 2011 7:47 am Post subject:

Now that that's been shaken out, still don't wanna be short...but impossible to be long (orange line breakevens):

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nodoodahs · Moderator Joined: 06 May 2005 Posts: 2408

rffrydr · Posted: Wed Apr 13, 2011 6:33 am Post subject:

JP Morgan survey showed a net treasury short position at its highest since May 2010. The net
short rose 4% to 17%. Longs were flat at 6% and shorts were up 4% to 23%.

Go PIMCO go.
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rffrydr · Posted: Mon Jan 10, 2011 7:48 am Post subject:

Dealers dramatically reduce inventory....but, still, it's only dealers:

rffrydr · Posted: Fri Jan 07, 2011 8:17 am Post subject:

Gross on the Bloomie today, confirming end of the bull--and denying beginning of the bear.
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rffrydr · Posted: Thu Jan 06, 2011 8:56 pm Post subject:

What's the trigger away of bonds? Last August Basel proposed all senior debt gets converted into equity before taxpayer money goes in. Wouldn't that just flip the cake?

With all the world's cash leaning heavily on bonds wouldn't that be quite the revaluation?! P/E's and NPAs would hardly be the measure of bank stock. In europe it's estimated 7/1 debt to equity in finance. Wouldn't that just flip the cake Shocked

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rffrydr · Posted: Tue Jan 04, 2011 7:57 am Post subject:

Buffett getting his refis in--and fixed. But we already Buffett's bullish on america.
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rffrydr · Posted: Wed Dec 22, 2010 7:04 am Post subject:

http://www.bloomberg.com/apps/quote?ticker=CESIG10:IND

Since we live in an age of "whisper numbers" and "guidance," and since trend moves usually turn on a dime this index is probably best for more generalized macro study.
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HenryTo · Posted: Tue Dec 21, 2010 10:54 am Post subject:

What is the Surprise Index and how does one calculate it?

rffrydr · Posted: Tue Dec 21, 2010 10:00 am Post subject:

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rffrydr · Posted: Wed Dec 15, 2010 9:35 pm Post subject:

Evidence? Look up, not down. They started THE move: Clinton took their vitriol and channeled it into policy. Before they knew it, the "vigilantes" (read Republicans) were co-opted by their own logic, and ended up rewarding the enemy. And the Democrats were re-invented. That culminated with the enthronement of Rubin at Citi. Overlay the aging of the boomers and we've got a strategic move.

Now, as we are linked by a common currency, do the chinese equal the new boomers? Bush the new Nixon? I don't think so. but time will out.

Imagine a very imaginable recovery: 2.5% inflation in a 4.5% economy, 5% 10-year treasury is very conservative. It's not the new normal, just normal. Yes, this will ultimately be good for stocks and hi-yield (as hinted at this last week)--but then there'd be no shock. Market is always ready for a good shock. Better for more bland jobs numbers now.

See above chart for beneficiaries; and also look to the big pensioners: states and autos Wink

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nodoodahs · Moderator Joined: 06 May 2005 Posts: 2408

rffrydr · Posted: Tue Dec 14, 2010 9:33 am Post subject:

The vigilantes will take much more than their credit:

http://ftalphaville.ft.com/blog/2010/12/14/435951/goldman-says-dont-fear-the-rising-bond-yields/

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rffrydr · Posted: Wed Dec 08, 2010 9:13 am Post subject:

Treasuries continue to spike on one-two punch of tax deficit "expansion"; which is being interpreted as a brake on QEII, which has not been fully formally committed to. Auction today.

Thought the euro-driven bond vigilantism would stay off its turn on the US 'til later in '11. Looks like they're chomping at the bit.
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rffrydr · Posted: Mon Dec 06, 2010 8:28 pm Post subject:

Downgrades to Verizon and ATT--two biggest non-financial bond issuers and key transition stocks in getting a dividend buy last summer. Not good for sentiment in general.
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