Tech, sybs waz a bit early W/ this. It waz when sybby waz calling an abrupt cut to QE in july '13, b4 ben decided to kick it to janet
"Reply to Bernanke aint gonna pick the time he exits qe, congress aint gonna pick it either by sybil_rulez •May 22, 2013 5:28 PM
sybil_rulez • May 22, 2013 9:22 PM Remove 0users liked this postsusers disliked this posts0Reply
"The 30 year T bill rates should be north of 5% at this point due to the unprecedented debt level we had if the Fed didn't intervene."
At some point they will be 5% and maybe more. It wont be because the fed haz raised interest rates to 'cool down a growth cycle'. It will be because china, japan, and the eu insist on highwr rates of return on the treasury auction from over night paper to long dayed bondz. A complacent vix with home mortgagez at 3.25% on 30 year notes, amd junk muni and corp bondz flying out the door at 1.5% do not reflect the risk trouble thats brewing in the GIGANTIC bond bubble, but at some point they will fully price risk much to bernankes dissapointment.
When interest 1st begin to rise it will be billed by the yakity yak media az a 'buy the banks' under a yeild recovery, and bernanke may say 'we have inflation again, and this iz healthy. We can scale back bond purchasez'. But then they will rise uncontrolably az a bond defualt fire storm catchez across the corporate junk and muniz , quickly ripping the gvt central banx buried in this trash. The yeild curve will invert with short term rate yeilds spiking to infinity, lending of all formz will lock up, and then KABOOM! Out go the lights - nice job ben.