The Bond Market Has Essentially Called BS On The Entire Greek Episode

The bond market sold off hard today, and yields are starting to look as if bond traders are calling out the negotiations supposedly causing problems in Europe.

Check out Bloomberg’s Global Benchmark Bond Indexes; for sovereigns, the only set of positions that ended higher last month was Greece – that was the only country who’s bonds were bid higher.

Last September was when Greek debt started to break down again, and the core European countries saw an already mature bond rally exaggerate long in the tooth. Within the last month, Greek debt has seen some sharp rally’s that tend to make me think of a topping process, and the other European countries are showing pivots which (especially given their already virtually free nature) could mark a bottom.

We have seen this play out so many times before that I don’t think any of us can really get into it again. Greece swears they’ll do something. Schaeuble swears Greece isn’t a country he’s ever heard of. Then a week later, there was a deal the whole time. It’s not worth getting worked up over.

The bond market called the question. Let’s see what happens.