Comments on: Stay Away from Treasury Bonds http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/ Macro Perspective on the Capital Markets, Economy, Geopolitics, Technology, and Digital Media Sat, 20 Mar 2010 23:51:49 -0400 http://wordpress.org/?v=2.9.2 hourly 1 By: Mark E Hoffer http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137416 Mark E Hoffer Mon, 05 Jan 2009 02:24:44 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137416 wunsa-, no prob, though, remember, mine is, merely, a singular opinion. lb, for instance, probably takes a different path to reach his, long TBT, conclusion.. w/that--lb, and wunsa-, had you seen this, from last week? By Rebecca Christie and Liz Capo McCormick Dec. 31 (Bloomberg) -- Bond dealers and hedge funds that fail to complete trades in Treasury securities face a penalty of as much as 3 percent on the proceeds of transactions, according to a Federal Reserve-backed industry code to be implemented in the next six months. The plan, which strengthens official oversight of trading, will be unveiled as soon as Jan. 5, said Thomas Wipf, chairman of the Treasury Market Practices Group and the head of institutional securities group financing at Morgan Stanley in New York. “It seems quite obvious that the Fed and Treasury cannot and will not accept the status quo for much longer,” Wipf said in an interview. Demand for Treasuries is so great that investors are lending cash for next to nothing to obtain the securities as collateral through repurchase agreements, or so-called repos. The problem is market participants haven’t always delivered the bonds, causing “fails” to exceed $5 trillion at their peak, according to the New York Fed. http://www.bloomberg.com/apps/news?pid=20601087&refer=worldwide&sid=aJQOEPb4pCYg wunsa-,

no prob, though, remember, mine is, merely, a singular opinion. lb, for instance, probably takes a different path to reach his, long TBT, conclusion..

w/that–lb, and wunsa-, had you seen this, from last week?

By Rebecca Christie and Liz Capo McCormick

Dec. 31 (Bloomberg) — Bond dealers and hedge funds that fail to complete trades in Treasury securities face a penalty of as much as 3 percent on the proceeds of transactions, according to a Federal Reserve-backed industry code to be implemented in the next six months.

The plan, which strengthens official oversight of trading, will be unveiled as soon as Jan. 5, said Thomas Wipf, chairman of the Treasury Market Practices Group and the head of institutional securities group financing at Morgan Stanley in New York.

“It seems quite obvious that the Fed and Treasury cannot and will not accept the status quo for much longer,” Wipf said in an interview.

Demand for Treasuries is so great that investors are lending cash for next to nothing to obtain the securities as collateral through repurchase agreements, or so-called repos. The problem is market participants haven’t always delivered the bonds, causing “fails” to exceed $5 trillion at their peak, according to the New York Fed.

http://www.bloomberg.com/apps/news?pid=20601087&refer=worldwide&sid=aJQOEPb4pCYg

]]> By: wunsacon http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137408 wunsacon Mon, 05 Jan 2009 01:25:38 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137408 Thanks, Mark. Thanks, Mark.

]]> By: Mark E Hoffer http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137383 Mark E Hoffer Sun, 04 Jan 2009 21:35:39 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137383 lb, at the "Don't Leave until You're ready to Go~"-School, "What If?" is inscribed over the Exit Door.. IOW, it's Fundamental, to keeping one around, to be around.. or, differently, that's the First Arrow to have in your Quiver.. ; - ~~ wunsa- after a Fashion, the More he Buys, the More Sellers he'll attract.. Macroeconomically, at the very minimum, this isn't the '50's, anymore.. lb,

at the “Don’t Leave until You’re ready to Go~”-School, “What If?” is inscribed over the Exit Door..

IOW, it’s Fundamental, to keeping one around, to be around..

or, differently, that’s the First Arrow to have in your Quiver..

; -

~~

wunsa-

after a Fashion, the More he Buys, the More Sellers he’ll attract..

Macroeconomically, at the very minimum, this isn’t the ’50’s, anymore..

]]> By: wunsacon http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137368 wunsacon Sun, 04 Jan 2009 20:06:37 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137368 Also, folks, remember Bernanke's 2002 speech? Doesn't he say he can purchase Treasuries in order to keep the yields low, as was supposedly done in the 1950's? Won't that hurt TBT investors? Also, folks, remember Bernanke’s 2002 speech? Doesn’t he say he can purchase Treasuries in order to keep the yields low, as was supposedly done in the 1950’s? Won’t that hurt TBT investors?

]]> By: wunsacon http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137364 wunsacon Sun, 04 Jan 2009 19:21:28 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137364 If bond prices fall, will money managers have to "rebalance" away from equities every month-end? If bond prices fall, will money managers have to “rebalance” away from equities every month-end?

]]> By: leftback http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137343 leftback Sun, 04 Jan 2009 17:26:45 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137343 Mark: I never stop thinking: "what if..?" :-) Mark: I never stop thinking: “what if..?” :-)

]]> By: Mark E Hoffer http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137340 Mark E Hoffer Sun, 04 Jan 2009 17:17:56 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137340 lb, looks like your motion will carry, as it should~ seems the 10 & 30-years(UST variants) are starting to unwind the recent spike, looks like the 'magnetic' effect of the 50-day m.a. is reasserting its pull.. be interesting to see if we get a bounce off that thing( the 50 m.a.), or we crash right through it--either way, it'll set the stage for, at least, 1Q '009.. btw, way to keep thinking.. lb,

looks like your motion will carry, as it should~

seems the 10 & 30-years(UST variants) are starting to unwind the recent spike, looks like the ‘magnetic’ effect of the 50-day m.a. is reasserting its pull..

be interesting to see if we get a bounce off that thing( the 50 m.a.), or we crash right through it–either way, it’ll set the stage for, at least, 1Q ‘009..

btw, way to keep thinking..

]]> By: Matt SF http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137335 Matt SF Sun, 04 Jan 2009 16:57:02 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137335 I second leftback's statements. The best trade in town are the ultrashort Treasury Bond ETFs... like TBT. I second leftback’s statements. The best trade in town are the ultrashort Treasury Bond ETFs… like TBT.

]]> By: leftback http://www.ritholtz.com/blog/2009/01/stay-away-from-treasury-bonds/comment-page-1/#comment-137321 leftback Sun, 04 Jan 2009 16:12:07 +0000 http://www.ritholtz.com/blog/?p=14912#comment-137321 So many reasons to sell... better deals in investment grade, extremely high yields in a variety of distressed debt vehicles, and a mountain of supply on the way. Disclosure: I am short the 10-year and will remain so until there is some indication that the federal deficit is under control. Could be a while.. So many reasons to sell… better deals in investment grade, extremely high yields in a variety of distressed debt vehicles, and a mountain of supply on the way. Disclosure: I am short the 10-year and will remain so until there is some indication that the federal deficit is under control. Could be a while..

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