2018 Flashbacks And Upside Down Bond Market Dynamics

With the Fed tapering Treasury purchases to "just" $4.5 billion per day from a peak of $75 billion during the worst of the COVID panic, some believe the stage is set for yields to rise as Steve Mnuchin borrows to fund virus relief measures. The argument is simple: More supply against a waning bid from Jerome Powell means higher yields. Occam's razor aside, simple arguments don't often stand up to scrutiny, and according to Nordea's Andreas Steno Larsen, "the Fed needs to buy MORE, if long bond

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One thought on “2018 Flashbacks And Upside Down Bond Market Dynamics”

For the sake of argument let’s say the US stock market turns and makes new lows, where would the money go? Said another way, is the current strength of the US market, given so many negative economic indicators, only because it’s the best among bad choices.