The Mighty Ben

Treasury yields reached the top of the recent range and appeared headed for a breakout when along came Ben, with his mighty arms outstretched he lifts up the playing field and tilts it, and back down yields went, in spite of the big week of Treasury auctions and the market facing a big wad of new paper to settle next week. It didn’t matter. Ben gave the all clear on the carry trade for 3 more years, although I don’t know how much carry you can get when 10 year yields are less than 2%. I guess if you use enough leverage…

We know this is going to blow up sooner or later. All we can do is watch the chart for signs. For now, the trading range that looks like a bottom in yields is intact. And so is the idea that the Fed at least, can make the market do what it wants, when it wants. But I heard that Bill Gross is loading up on Treasuries again, after missing, or being short, through the whole rally. If that’s not a sell signal, what is?

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Tags: 3 Month, Bill Gross, Breakout, Carry Trade, Central Banks, Cutting Edge, Edge Analysis, Leverage, Liquidity, Machinations, Professional Edition, Rally, Spite, Thirty Days, Treasuries, Treasury Auctions, Treasury Yields, Us Housing Market, Wad, Wall Street

This entry was posted on January 27, 2012 at 12:35 am and is filed under Money and The Fed, Professional Edition, Top Stories. You can follow any responses to this entry through the RSS 2.0 feed.