Ten-Year Note Rates Jump--They Better Get a Handle on This

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#1 Thu, Jun 30, 2011 - 7:16pm
Jake
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Ten-Year Note Rates Jump--They Better Get a Handle on This

The Fed Can't Let Bond Rates Get Out of Hand. They've risen quickly in the last few days. The Last Time A Short-Term Bond Cycle Like This Ended, The 10-Year Note Went to 4% Where They Quickly Intervened--But That Was When QE2 Was Still a Reality. This Time It'll Be Different. High Rates Mean Expensive Debt Service

10-Year Note Rate Chart Last Few Days: https://tinyurl.com/3gwn3um

Here's an Excerpt From:

https://www.bloomberg.com/news/2011-06-30/treasury-10-year-notes-fall-fo...

Treasury 10-Year Yields Rise to Month’s High as Greek Default Risk Eases

By Susanne Walker - Jun 30, 2011 2:16 PM PT Thu Jun 30 21:16:23 GMT 2011 10-Year Treasury Yields Expected to Rise Play Video

June 30 (Bloomberg) -- Jeffrey Rosenberg, head of global credit strategy research at Bank of America Merrill Lynch, discusses the U.S. bond and stock markets, and investment strategy. He speaks with Tom Keene on Bloomberg Television's "Surveillance Midday." (Source: Bloomberg)

Treasuries fell, pushing benchmark 10-year note yields to the highest level in June, as Greece’s parliament approved a second bill to authorize austerity measures needed for further financial aid.

Ten-year notes slid for a fourth straight day in the longest losing streak since February as stocks rose, a measure of U.S. business activity improved and the Federal Reserve ended a $600 billion program of debt buying. Bonds pared gains in the second quarter as the three government note auctions this week drew poor demand.

“We have clearly taken out the Greek risk as far as it impacted Treasuries,” said David Ader, head of government bond strategy at CRT Capital Group LLC in Stamford, Connecticut. “From this day forward, we will have to deal with the Treasury supply on our own. We are adjusting to the new world.”

Yields on 10-year notes increased five basis points, or 0.05 percentage point, to 3.16 percent at 5:14 p.m. in New York, according to Bloomberg Bond Trader prices. The 3.125 percent securities maturing in May 2021 dropped 13/32, or $4.06 per $1,000 face amount, to 99 22/32.

The 10-year note yields touched 3.22 percent, the highest level since May 19. Yields on two-year notes were little changed at 0.46 percent after reaching 0.51 percent, the highest level since May 26. The five-year note yields advanced seven basis points to 1.76 percent after increasing to 1.81 percent, also the highest level since May 26.

Edited by: Jake on Nov 8, 2014 - 5:06am
Sat, Jul 2, 2011 - 4:40pm
Jake
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Rapid Increase in Rates Followed by Down Grades Coming?

FROM ZERO HEDGE: Posted in the Harvey Blog:

https://harveyorgan.blogspot.com/2011/07/another-gold-and-silver-raidcot...

T-Minus Two Months Until The $500 Billion Rolling Debt Ticking Timebomb Goes Off Tyler Durden's picture

Submitted by Tyler Durden on 07/01/2011 14:07 -0400

EXCERPT:

"The BPC's observations on what happens on August 4 absent a deal are rather spot on:
  • If the debt ceiling is not raised by August 2, all three ratings agencies will put the United States on watch for a downgrade, at a minimum. Fitch (6/8/11):
    • “If the debt ceiling is not raised by the [X Date] and timely and full payment of its obligations, including Treasuries, is not secure, the U.S. sovereign rating will be placed on Rating Watch Negative.”
  • An actual downgrade would cause major losses among holders
  • Even without downgrade, it is likely that rates would increase, perhaps significantly

    • Less likely, but possible, that Treasury would lose market access during such an unprecedented event and default
As a reminder we are now 32 days away from D-Day, and about 60 days from the need to fund half a trillion, all of it with new gross debt issuance."
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Sat, Jul 2, 2011 - 9:08pm
Seacap81
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Debt ceiling raised is a done deal lucille

Friday night on Freedom Watch the Judge had staunch conservative and Tea Party member, Mike Lee, on his show. It was an amazing interview. Mike Lee is a Senator from Utah and has insisted Congress not spend anymore, the debt ceiling must not be raised, etc. That was before Friday night. He is now singing a different tune and it sounds like he will vote for a debt ceiling increase. Yeah, he wants a balanced budget amendment, blah, blah, blah, but in the end he will vote to increase our debt. It is just absolutely amazing to watch how our congress critters become tainted by Washington D.C. Judge Napolitano was stunned to hear about Lee's reversal on the debt ceiling. Another Tea party member goes wobbly! The debt ceiling being raised was always a foregone conclusion. Fiscal conservatives ought to be outraged by the Tea Party turncoats.

Wed, Jul 6, 2011 - 11:13am
Jake
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New Article on the Subject

Without Low Interest Rates, The U.S. Financial System Dies

https://theeconomiccollapseblog.com/

Right now, interest rates are near historic lows. The U.S. government is able to borrow gigantic mountains of money for next to nothing. U.S. consumers are still able to get home loans, car loans and student loans at ridiculously low interest rates. When this low interest rate environment changes (and it will), it is going to absolutely devastate the U.S. economy. Without low interest rates, the U.S. financial system dies. When it comes to borrowing money, it is the rate of interest that causes the pain. If you could borrow as much money as you wanted at a zero rate of interest for the rest of your life you would never, ever have a debt problem. But when there is a cost to borrowing money that changes things. The higher the rate of interest goes, the more painful debt becomes. (Read More....)

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