That's what I had thought for the past few years. But strangely enough, rates continue to go lower. When equites were going higher, I understood why T-bill prices moved higher pushing down rates. But, now that equites are going lower, why rates continue to go down? Does anyone have any explanations please?
As CL has pointed out before, when stocks fall, the big boyz usually move into t-bonds for "safety."
These days, things are so outta wack from ZIRP, that the same old same old may not work so well--see Japan and the JGBs in relation to the Nikkei 225 or is that 2-2-dive? :)
BNP Warns On Japanese Repression: Echoes Of The 1940s Fed--Put that in your browser, since the yahoos here don't allow links. It is a pretty good summary of the capping I was talking about which may take place in Japan and actually took place in our good ole USA of the 1940s. Kind of knee-capping of trashury shorts.
Maybe the central bankstas are finally losing control. My big prob with TMV is determining what the bankstas will defend--they might actually defend the trashuries pretty hard. You know dang well they won't defend confetti (currencies). In the meantime, gold and other commodities are in the tank--with the commercial traders in gold holding their biggest long position in gold now and with COMEX short positions on gold higher than any time in recent history, gold might be a better bet than TMV when control is lost--that's just me though--good luck with TMV!!
The bernank was just testing the waters. The talking heads think it will be next year before they actually slow down their criminal activity. When equities get hit, the money usually goes into Tpaper. Be careful here.
NipponMarketBlog has the distinct feeling that Japan’s monetary policy is akin to a car speeding along on the road, and from the outside everything looks normal. However, but if you look inside the car you’ll find that it has no steering wheel but only an accelerator and a slightly dubious looking brake. We hope for Japan’s sake that there are no bends in the road coming up.--from the blog of the same name