us treasuries

Multi-dimensional Navigation of Systemic ‘Dollar’ Alteration

By |2015-03-17T16:35:33-04:00March 17th, 2015|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Under the traditional formula for viewing currency movements, a rising currency is believed to be a huge impediment for economic expansion as exports “become relatively more expensive” against trading partners and competitors. This is a two-dimensional view in three-dimensional space as it leaves out the very necessities of finance. It isn’t just straightforward that one causes the other, as the [...]

Bank Hoarding in The Mainstream

By |2015-03-13T16:50:51-04:00March 13th, 2015|Markets|

The issue of bank hoarding has become nearly mainstream as the size of the move into UST is now too large to ignore. It wasn’t so much an issue last year, apparently, as there was less to suggest taking very pessimistic portfolio allocations was anything other than an anomaly of regulation. This year the idea of prudence as opposed to [...]

Winter That Never Ends; Or One That Never Really Began

By |2015-03-12T11:33:52-04:00March 12th, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

None of the following is unexpected given the “unexpected” nature of retail sales contradicting everything that was expected. Consumers are not acting like they “should” as the unemployment rate describes its version of the economy. From Bloomberg: Purchases unexpectedly dropped 0.6 percent, a third consecutive decline, Commerce Department figures showed Thursday in Washington. The median forecast of 86 economists surveyed [...]

Regularity of the Tails

By |2015-03-11T15:58:31-04:00March 11th, 2015|Markets|

The FOMC continues to test out its exit strategies in a determined effort to try to gain a somewhat hard and durable floor under interbank rates. To this point, there hasn’t been any sign of any effect whatsoever. That would include the apparently semi-permanent state in which US$ repo persists under heavy fails. This negative condition is supposed to be [...]

Where There’s A Rising ‘Dollar’ There Is Short Collateral But Plentiful ‘Reserves’

By |2015-03-03T16:40:03-05:00March 3rd, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

The Federal Reserve is running another large-scale test on its Term Deposit Facility (TDF), the account by which it intends to establish a European-style floor to its also intended interest rate corridor. Judging by the fact that nobody has paid any attention to this test or the one that preceded it, except for those that were fooled into thinking the [...]

Regulations Are Bad Enough, But QE May Have Been So Much Worse

By |2015-02-25T16:58:26-05:00February 25th, 2015|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Along with the new Basel-y rules to be adopted for the banking system, there are other major changes that have remapped at least domestic finance since 2007. A big part of this pertains to the systemic liquidity capacity that I emphasize repeatedly, but in the sense that it is far more and different than just the “capital rules” that most [...]

Yes, December Was Indeed A Dramatic Mess

By |2015-02-19T13:32:50-05:00February 19th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

With the latest release of the Treasury Department’s TIC statistics there is a lot about December now that makes sense. Much of what is contained within the figures matches the theories I put forward contemporarily, including the severity of the “dollar” problem that month (leading to any number of downstream effects, including seriously heightened bearishness in US credit markets) and [...]

…At The Beginning

By |2015-02-18T16:39:34-05:00February 18th, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

It was a bit of a shock in June 2014 when the repo market experienced sudden and sharp disorder. The surge in fails seemingly did not fit the conditions as convention held them in the middle of last year when everything was supposedly running so smoothly. In the eight months since then, repo fails have not much calmed, which has [...]

The Greek ‘Premium’ Revealed?

By |2015-02-10T12:19:19-05:00February 10th, 2015|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I’ve had my suspicions for some time that December saw a(n) (il)liquidity event throughout the “dollar” system. The problem with that supposition is the lack of corroborating price action in riskier markets where you would expect the most impact. That was the pattern revealed by the end of the last event on October 15, where risky credit, especially corporate junk [...]

Finally Retracement

By |2015-02-06T17:21:54-05:00February 6th, 2015|Bonds, Commodities, Economy, Federal Reserve/Monetary Policy, Markets|

When the FOMC came out and said the economy was good enough for them to begin raising interest rates, the eurodollar funding market did the opposite of what would be expected of that situation. Not only did the market move in the “wrong” direction, it did so with a great deal of conviction. Today’s jobs report moved the eurodollar market [...]

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