Record Low 30-Year Bond Yield and Record High on Gold Coming Up

Mish

Once again, the yield on the 30-year long bond is below 2.0%. I expect a record low yield shortly. Gold will benefit.

The record low 30-year long bond yield intraday was on August 28, 2019 at 1.907%.

On a closing basis, the record low was 1.94%.

Those records are poised to fall due to a slowdown in shipping coupled with the coronavirus.

As noted earlier today, there is Little Chance of Coronavirus Containment in South Korea.

And in China, Half the Population of China, 760 Million, Now Locked Down

From an economic standpoint, January saw the Largest Shipping Decline Since 2009 and That's Before Coronavirus impact hit.

There is no coronavirus containment. Bond yields will fall.

I expect a surprise rate cut at some point. This combination adds fuel for a further rise in the prices of gold.

In case you missed it, Gold at Record High in Euros. A record high in US dollars is also coming up.

Mike "Mish" Shedlock

Comments (15)
lol
lol

Like virtually all banana republics soaring govt deficits are being hidden off balance sheet by shady sham accounting and blatant fraud.Half a trillion dollar MONTHLY deficits are baked in by Q4,but,but ,but almost like magic the fiscal year deficit will clock in at …..$1 trillion and change!!!!!Where did the other $3plus trillion go?????

No. 1-8
Greggg
Greggg

Go look at Canada's: 10 Year is lowest yield @ 1.31 and the top rate is the 6 month @ 1.64. The 30 year is in the middle.

Casual_Observer
Casual_Observer

Almost at 1/1/1 . My prediction will come true much sooner than even I expected. We will get a bounce if Coronavirus slows.

KidHorn
KidHorn

Hope you're right about gold, but I suspect manipulation in prices if it gets too high. CBs never want the price of gold to skyrocket.

Flatlaxity
Flatlaxity

While the Fed's balance sheet increase has leveled-off for the last eight weeks, seemingly having fixed the "Repo" interest rate problems, the sheets of other major center banks, (ECB, BOJ, PBOC, etc.) continue to significantly expand - especially due to the effects of the coronavirus. Simply put, much of this increased money availability is finding its way into US bonds, stocks, $US and gold.

bradw2k
bradw2k

"I expect a record low yield shortly." Well that was a good call.

Captain Ahab
Captain Ahab

If gold has no use in fiat economies, why would central banks care what price it is... unless they are accumulating? Which begs the question why would a fiat economy acquire gold if the currency is not gold-redeemable. One reason might be they are worried about gold replacing their fiat money...

2 Replies

KidHorn
KidHorn

It's a competitive store of value they can't make out of nothing.

Snow_Dog
Snow_Dog

My small business can create productivity out of nothing, ...ur, um, at least my accountant assures me that we can.

Anon1970
Anon1970

Canada's central bank is the only one among the major economies which owns no gold reserves.


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