Omg The 30s!

I suppose you can admire their zeal and persistence, but then again what is a zealot without his or her zeal? The desperation by which to rescue the Fed’s money printing exercise is palpable. Stocks, sure, bonds, however, aren’t making it easy. Especially inflation expectations which are crucial to Jay Powell’s fairy tale.

That whole flood.

Over the last several days, Bloomberg (obviously) has been unusually and sharply focused on the 30-year long bond. The publisher like everyone else mainstream absolutely hated the damn thing for years when it was inconveniently signaling (correctly) that globally synchronized growth was a bumper sticker slogan and never anything more than that.

Now they can’t get enough of the long end. Why?

Investors in the world’s biggest bond market are starting to see what the other side of America’s worst-ever economic downturn could mean for their portfolios… “It would signal the curve may be steepening more so for economic reasons,” said Chris Ahrens, a strategist at Stifel Nicolaus & Co. “The long end seems to be pricing that we are getting to the worst of the bottoming of the economy.”

BOND ROUT!!! baby.

There’s more (another article today, thanks to M. Simmons):

The re-steepening since then reflects Fed policy expectations that are keeping short-term rates low, while the Treasury boosts long-maturity supply to finance economic-recovery measures, said Guneet Dhingra, head of U.S. interest-rate strategy at Morgan Stanley. The curve’s move also coincides with a sense that the economy may be starting to revive after months of lockdown measures, with stocks hovering near the highest in almost three months.

And it’s true, the 5s30s haven’t been this wide since May 2017. Big things, right? Huge. Massive stuff befitting the Fed’s printing press explosion.

Yeah, no.

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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