This is getting very little attention as we’re mostly transfixed on geopolitical events — but the bond rout continues unabated. Not only are treasuries getting routed, but CMBS, High Yield, Munis etc. The entire zero interest rate paradigm is being reversed, all of a sudden without brakes.
So who’s taking losses aside from bond funds? Major institutional holders, old fucks relying on bonds for income, pensions, foreign sovereign funds etc.
Oddly enough, we have heard very little about bond desks and if this price action is causing losses. People are acting as if this shit isn’t happening, like it’s totally fucking normal for mortgage rates to jump 50% in a few months. No big fucking deal – keep buying housing stocks because everyone is rich and everyone is pay all cash anyway so rates can fuck off.
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I don’t understand what the hell is going on with TIP in all this.
Also High Yield is dropping support too. HYG JNK
Last time this happened was before the .com crash?
What ‘this’ do you speak of?
Strictly speaking, none of this has ever happened before as the Fed has never before taken such extremes or been so thoroughly shut down.
I wonder if some of those bond sellers will rotate into stocks only to get fried immediately.
Recall Bernanke and the others acting so confident about the bond purchases being reversable and therefore not really money printing. That notion is looking more insane by the day and the balance sheet will stay huge for many years.
Ran out of road to kick the can down?
Propped up markets for 14 years?
Shitty legislation creates shitty problems.