Welcome Back 30-Year One Handle We Missed You

-edited

The 30-year long bond yield just fell back below 2.00% for the first time since September 4.

The 30-year long bond yield rose above 2.00% on September 5 and stayed above that rate for over a month.

From September 13 through 15, the yield topped at 2.375%.

I am wondering how much of that spike is related to overnight funding topping 10.0%.

Regardless, welcome back sub-2.0% we missed you.

A slew of bad economic reports is behind the collapse.

On October 1 the ISM reported Manufacturing Worst Since 2009 on Severe Contraction of Export Orders.

Also note, the Fed has Recession Tools, Promises to Use them Quicker Next Time.

Mike "Mish" Shedlock

Comments (23)
No. 1-3
Je'Ri
Je'Ri

Has anyone ever told Trump and his cheerleaders that unemployment is a lagging indicator?

Country Bob
Country Bob

Since US Treasuries are no longer market priced (and haven't been in many years), the government imposed yield on whatever maturity has no meaning and no significance.

The yield is whatever the Fed committee decides it is. There is very very limited liquidity in the Treasury market, and no price discovery going on at all.

Yes, a decade ago Treasuries was the most liquid market on the planet (by a long shot). But that is no longer the case.

Credit card rates continue to go UP, not down.

Even though car loans are "free" (0% financing etc) -- the financing is actually built into the price, even for used cars. When was the last time a car ad displayed the actual price of the car, instead of lease / financing terms?

At least 80% of new mortgages now are underwritten by the federal government (FNMA, FHLMC, GNMA).... the rates are set by politicians who are desperate to keep home prices elevated (capital gains taxes, property taxes, bank bailout costs, etc).

We all joke about Government Motors no longer being a private entity except on paper.

Its time to acknowledge the US Treasury market is mostly the US government on both sides of trades.

KidHorn
KidHorn

Get used to it. And in time, the handle will be 0. Hopefully the number will stay above 0. But, it wouldn't shock me if it went negative.