Reading the Economy

[Sooner or later]

Since you know all of the intricate details of the clock, what time frame is there for this worldwide meltdown?

[recycled sixtie]

Using baseball analogy a biz analyst the other day on our BNN channel said we were in the 5th inning. To me it feels like the 8th. Having said that I have great respect for a low cost balanced mutual fund. In this case I let the mutual fund analysts do the respective bond weightings.

This does not reflect the tabs factor but I feel good with it.

[KFC911]

Interesting thread....I remember when Reagan was campaigning the first time about how our debt (still under 1T) was a big problem....that a TRILLION was a lot....it was . Disagree with SOL on one point...there has NEVER been one memtion about paying the debt back....just "servicing it".... reeks of corporate nonsense if ya ask me....jmho. I'm mostly parked in short term bonds/cds, etc. (2.5 yr avg maturity) and will flow with the tides...like we all do

Bond funds....no way, no how....not me...

[tabs]

Originally Posted by jyl

The bulls think GDP is going to accelerate to 3%+. I don't see it. Most of the (huge) corporate tax cut is going to share buyback, corprate debt paydown, M&A. These aren't especially stimulative activities for the economy, although they stimulate investors. Temporarily.

This is exactly what I have been thinking. Corps up till now have been sitting on their large profits and not investing in increasing capacity. So what is going to change their outlook? TRUMP? Pffft.

[tabs]

Originally Posted by Sooner or later

Since you know all of the intricate details of the clock, what time frame is there for this worldwide meltdown?

You don't have the security clearance for that sort of Intel.

[Tervuren]

Originally Posted by wayner

I find this interesting.
I always that thought that bond "funds" went up as a result of interest rates falling.
(if rates are falling, and if you need the money out of your bond, I'd like to buy your bond that you are holding that pays a higher rate than the going interest rate, ad if I expect rates to fall further, I may be willing to pay a bit more for it).

I haven't looked at new issue bonds though. For them I thought that they chased the interest rates downward, just paying a bit more than the bank account interest rates to still make them appealing.

Thoughts??

I was looking not at the value of existing bonds, but interest rates of U.S. Treasury Bonds.

Think of it this way, as a bond issuer(not buyer) you want the lowest interest rate you can issue.

The more people that want to buy the bond you issue, the lower the rate.

If everyone is trying to buy short term bonds to keep their money mobile and agile, then to get someone to buy a long term bond there must be a higher interest rate to attract buyers.

So you're speaking of bond value on the market relative to the balance of the bond compared to interest rates on newly issued bonds.

I am looking for what controls the rate on newly issued bonds.

For example, if there were no control on newly issued U.S Treasure bond interests except what the government set it, and negative yield curve was considered a recession marker.
Why would the government that controls the yield rate of U.S. T. not keep it positive in order to keep this signal from making them look bad?

So the government must feel some form of pressure to set the rates on new U.S. Treasury bonds. Does this make sense what I'm looking at?

Its not about buying used bonds, but the interest rates of freshly issued bonds.

[jyl]

Buyers of newly issued bonds set the yield. The issuer (US govt here) sets the coupon, not the yield.

https://www.treasurydirect.gov/instit/auctfund/work/work.htm

Originally Posted by Tervuren

I was looking not at the value of existing bonds, but interest rates of U.S. Treasury Bonds.

Think of it this way, as a bond issuer(not buyer) you want the lowest interest rate you can issue.

The more people that want to buy the bond you issue, the lower the rate.

If everyone is trying to buy short term bonds to keep their money mobile and agile, then to get someone to buy a long term bond there must be a higher interest rate to attract buyers.

So you're speaking of bond value on the market relative to the balance of the bond compared to interest rates on newly issued bonds.

I am looking for what controls the rate on newly issued bonds.

For example, if there were no control on newly issued U.S Treasure bond interests except what the government set it, and negative yield curve was considered a recession marker.
Why would the government that controls the yield rate of U.S. T. not keep it positive in order to keep this signal from making them look bad?

So the government must feel some form of pressure to set the rates on new U.S. Treasury bonds. Does this make sense what I'm looking at?

Its not about buying used bonds, but the interest rates of freshly issued bonds.

[wayner]

Thanks everyone for clarifying the bond discussion. It helps to have context.

[tabs]

Then there is the bid to cover ratio...which shows demand for the bonds.

[Shaun @ Tru6]

Here’s when the yield curve actually becomes a stock-market danger signal



The stock market is days away from setting a bearish record



Market holds out hope someone will blink before China and US take another step toward a trade war

[Sooner or later]

Originally Posted by Shaun @ Tru6

Here’s when the yield curve actually becomes a stock-market danger signal



The stock market is days away from setting a bearish record



Market holds out hope someone will blink before China and US take another step toward a trade war

We are due for a recession. Can't afford one. But we are due.


It wll be the ****s and Tabs will be all over it...

[Captain Ahab Jr]

Originally Posted by tabs

in 1980 I started saying that the US government would continue on with business as usual until it could not beg, borrow, print, steal nor tax another dime. When the business as usual regime comes to a screeching halt is the day that you will wake up...until then carry on kicking the can down the road. It is the simple math of human nature...civilizations come civilizations go...

nearly 40 years of saying your right, have you have thought you might be wrong or will you give it another 40 years before you admit maybe you didn't quite call it correctly?

You heard it here first, human civilization is going to end, you guys know nothing, one day you'll live to regret not taking head of my post

[tabs]

Originally Posted by Sooner or later

We are due for a recession. Can't afford one. But we are due.


It wll be the ****s and Tabs will be all over it...

Do I really need to talk to let alone try and convince an inferior white person?

Recession is fallacious thinking.

1. You have to have had a recovery for there to be a new recession. With a 1.6% year over year growth rate that mirrors the rate of populton increase there has been no recovery.With all the juice of monetary and fiscal policy pouring into the economy you would think that under normal circumstances the economy would run like a scalded dog. What has happened is all that juice has done is keep the economies head above water with growth at the rate of population increase.

2. The mere linguistical use of the word "recession" indicates a perceptional mindset that the situation has remained the same old business as usual model. It does not indicate an understanding that the world has changed in 2008 and that all of the old tricks that put Humpty Dumpty back together again in the past only have gotten you a 1.6% growth rate which is just keeping your head above water

As an inferior white person you do not comprehend that 2008 was the beginning of a new epoch. You are living in the past and are unable to understand those changes.

[Sooner or later]

Why are you being such a dick?

Ii pretty much agree with everything you say except your "we are doomed" take on the situatiion.

A recession (slowing of the current economy) would be disastrous and could lead ro your worst case belief.

[tabs]

Originally Posted by Captain Ahab Jr

nearly 40 years of saying your right, have you have thought you might be wrong or will you give it another 40 years before you admit maybe you didn't quite call it correctly?

You heard it here first, human civilization is going to end, you guys know nothing, one day you'll live to regret not taking head of my post

You have a short event horizon which as an inferior white person comes from having been dumbed down by watching too much episode television. Where every story line is either resolved in a half hour or and hour less commercials....In other words you have been conditioned to thinking in the short term and grow impatient when reality does not work out that way. BTW what laundry detergent do you use?

[tabs]

Originally Posted by Sooner or later

Why are you being such a dick?

Ii pretty much agree with everything you say except your "we are doomed" take on the situation.

A recession (slowing of the current economy) would be disastrous and could lead ro your worst case belief.

I realize that you are agreeing pretty much with what I am saying when you say that a recession could be "DIASTEROUS>"

I think your mistake is in thinking that there has been a recovery, and do not realize that the FED is keeping the economic head above water so there will be NO APPEARANCE of a recession until the shyte hits the fan. Then it is over, the Sovereign Debt Bubble will deflate.

The sea of debt creation is what is keeping the Global economic ship afloat.


Now Trump is after NATO to chip in their fair share of their defense costs...which if they did would mean that they have to either raise taxes, divert monies from social programs or create more debt...This of course is going to cause a lot of resistance as the EU allies react in horror to the prospect of an increased demand on their economies.

[Captain Ahab Jr]

Originally Posted by tabs

You have a short event horizon which as an inferior white person comes from having been dumbed down by watching too much episode television. Where every story line is either resolved in a half hour or and hour less commercials....In other words you have been conditioned to thinking in the short term and grow impatient when reality does not work out that way. BTW what laundry detergent do you use?

You know nothing about me, I might not even be white or dumb or even watch TV

I have the attention span to watch a whole football match in only two halves but I will admit to not being able to watch a whole F1 grand prix without having a snooze

BTW do you lick toads or eat magic mushrooms?

Tabs I enjoy your posts as it makes the world I see all sunshine, rainbows and unicorns

[tabs]

Originally Posted by Captain Ahab Jr

You know nothing about me, I might not even be white or dumb or even watch TV

I have the attention span to watch a whole football match in only two halves but I will admit to not being able to watch a whole F1 grand prix without having a snooze

BTW do you lick toads or eat magic mushrooms?

Tabs I enjoy your posts as it makes the world I see all sunshine, rainbows and unicorns

I have reached a state of transcendental nirvana from self reflective meditation. OMMMMM...Ommmmm.....ommmmm..... Now I have to put on my white robe and head on down to the airport.

[Captain Ahab Jr]

Originally Posted by tabs

I have reached a state of transcendental nirvana from self reflective meditation. OMMMMM...Ommmmm.....ommmmm..... Now I have to put on my white robe and head on down to the airport.

watch out you don't breathe in any of dem chemtrails

If your plane is headed to the UK, I'll have a pint of beer waiting with your name on it

[Shaun @ Tru6]

Originally Posted by tabs

I have reached a state of transcendental nirvana from self reflective meditation. OMMMMM...Ommmmm.....ommmmm..... Now I have to put on my white robe and head on down to the airport.

Don't you mean the Wynn buffet?