You’ve been beating this dead horse for months, yet rates keep falling. Must be really frustrating.
The only objective data we have is the Treasury data as of 11/30/15 – anything else is just conjecture (and I like Jeff Gundlach, by the way, and he’s been absolutely correct in predicting lower long-term rates for the past few years). My point is that while the WSJ and Bloomberg were running stories back in late October/early November about foreign central banks dumping Treasurys, the most recent data shows that that wasn’t the entire story. While the Chinese were selling last year, other central banks were buying. Could things have changed since November 30th? Of course, but we’ll have to wait a couple of months to find out for sure.
You’re focusing on the sellers, but ignoring the buyers. Since November 2014, Ireland increased holdings by $52 billion; Switzerland by $44 billion; UK by $40 billion, etc. Total foreign holdings actually increased by about $10 billion over the November to November time period, so as EM countries sell, DM countries are buying. In answer to your question, the next updated (December) will likely be released somewhere around the 16th of next month.
Hi Chip, I've actually tried a couple of times, but there were technical problems each time (and I didn't have the patience to work with their tech support). I'm confused by the format anyway, though. Is there the ability to start a discussion thread on a particular topic, or is it just one long, stream-of-consiousness thread for each ticker?
Good news! Based on this morning’s residential investment data, the GDPNow forecast for Q4 was increased from 0.6% to 0.7%. The bad news, of course, is that Street consensus is still around 2%, haha. There is only one more scheduled update before the BEA release on January 29th.
The Treasury Department updated its Major Foreign Holders data last night (holdings as of November 30, 2015) and whaddya know, total foreign holdings increased by $78 billion (from $6.05 trillion to $6.13 trillion). Chinese holdings increased by $10 billion (from $1.26 trillion to $1.27 trillion. Even total foreign official holdings (i.e., foreign central banks) increased their holdings by $18 billion.
But didn?t the WSJ?s Min Zeng (and a few other #$%$) tell us that central banks around the world at that time were ?selling US government bonds at the fastest pace on record?? Yes, but they neglected to notice that other central banks (not to mention foreign private investors) were busy buying. Here?s a link to the updated data:
An interesting concept of behavioral finance is regret avoidance. Rather than admit their mistakes and suffer regret, investors cling to their discredited investment thesis and claim they will ultimately be vindicated. Meanwhile, they lose everything.
But your buddy Brian Kelly has been recommending TLT for the past couple of weeks. You must be terribly conflicted, lol
You and your aliases stop by here every couple of months to tell us this, yet long-term interest rates keep falling. How do you explain that?
The IMF just cut its global growth forecast from 3.6% to 3.4%. I think the IMF reduced its forecast four times in 2015. It happens every single year now, lol
Some countries have been selling, while others (including India, Switzerland and the UK) have been massive buyers over the past 12 months. The only thing that matters is the total. In October 2014, foreign ownership of US Treasurys totaled $6.06 trillion. In October 2015 (the most recent data available), the total was $6.05 trillion, practically the same. You can see the latest data here:
Five minutes after the market closed, highly unusual. Just when I was starting to respect the Atlanta Fed for its independence and truthiness...
Based on this morning’s retail sales and industrial production data, the GDPNow forecast for Q4 real GDP growth was lowered from 0.8% to 0.6%. Who could have seen this horrible quarter coming? Certainly not Grandma Yellen! There are only two more scheduled updates before the BEA releases its first estimate on January 29th.
Maybe folks are already anticipating a Fed policy reversal? QE4, anyone? Dudley was babbling about the possibility of negative interest rates in his Q&A earlier today, haha
I was a little puzzled by that comment in the latest Hoisington report (which I think was written by Lacy Hunt, by the way), but I don't think Lacy was necessarily hinting at higher yields in the short term. I think he was just hedging his short-term inflation expectations a bit because of the "base effect" of oil prices. At the time he likely wrote that report, though (end of December?), WTI was trading around $37/barrel. Now we've broken the $30 barrier. Lacy is a genius, but even he would concede that he can't predict short-term oil price movements (or even short-term moves in Treasurys, for that matter).
With the AB InBev rate locks out of the way, we're seeing the type of price action today that we should have seen two days ago. Remember, confidence-promoting rate hikes promote confidence! lol
And what damages were awarded in the AIG case? None. In the 1987 S&L crisis, back when we truly had the rule of law, the DOJ prosecuted over a thousand bankers, sending many to jail. Those days are gone...
You've mentioned your "shadow" QE theory before, and I'm intrigued by it, but what would be the point of such a program? The whole point of QE was to raise inflation expectations and make the market feel like the Fed had its back (both intended to stir up "animal spirits"). What would a secret QE accomplish exactly?