Trump can inflict more pain on China than China can inflict on the US.
China appears it's willing to suffer and wait for the results of 2020 elections rather than cave to Trump.
China has that luxury... they do not hold elections.
FORT COLLINS, Colo. (Reuters) - Corn exports fall off a cliff https://uk.reuters.com/article/us-usa-gr...KKCN1UW0MQ- U.S. corn shipments fell to a 19-month low in June... exported 3.07 million tonnes of corn, the smallest June volume in six years
- U.S. soybean exports were record large for the month as shippers look to fulfill the large amount of outstanding sales to top buyer China.
Record low yields on the horizon? Maybe, but when the investing world seems certain about X, the trend usually reverses.
Inflation? Fugetaboutit... the bond market says otherwise, in addition to the Fed's unrealistic 2% inflation target.
The weekly chart of 10yr treasury yield and SP500:
- UST 10yr yield... red/black candlesticks.
- SP500 price... solid black line.
The real issue is debt and servicing that debt. The global economy is choking on debt. I suspect QE4 or will it be QE5? QE6?... I've lost count... regardless, I suspect the next QE will be epic. The previous QE produced the current 10yr bull market. Eventually, the supply of greater fools will dry up and the global debt problem will have to be addressed and resolved.
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(08-11-2019, 02:55 PM)BoyGenius Wrote: Record low yields on the horizon? Maybe, but when the investing world seems certain about X, the trend usually reverses.
Inflation? Fugetaboutit... the bond market says otherwise, in addition to the Fed's unrealistic 2% inflation target.
The weekly chart of 10yr treasury yield and SP500:
- UST 10yr yield... red/black candlesticks.
- SP500 price... solid black line.
The real issue is debt and servicing that debt. The global economy is choking on debt. I suspect QE4 or will it be QE5? QE6?... I've lost count... regardless, I suspect the next QE will be epic. The previous QE produced the current 10yr bull market. Eventually, the supply of greater fools will dry up and the global debt problem will have to be addressed and resolved. The only way to resolve it is through restructuring debt or forgiveness and someone is going to lose. Countries like Singagore who have their act together or some nations of Europe like Switzerland etc won't want to forgive or restructure or lose. You can't blame them.
Our debt involves entitlements, social programs and defense. I think the US is really about 100 trillion in debt when you add all of it up.
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(07-02-2019, 11:21 AM)cincydawg Wrote: I don't usually try and read tea leaves about where things are headed in part because I have been wrong in the past often enough to realize I'm not good at it. I will opine that things don't look good to me right now, meaning an economic slow down/recession looks more likely to me than it did January 1, perhaps this fall.
I am more bearish now than I was then, FWIW. Futures today are odd a bit, not that much. I see quite a few leading indicators that are lagging, like rail shipments etc. The main thing was watching bond prices drop as fast as they did. The ten year is under two percent now.
The retirees had a bit of cheer when interest rates moved up a bit, they could start seeing 2.3% returns on CDs for a bit, then boom. Of course, your after tax return on 2.3% in real dollars is likely negative but you feel good.
A "normal recovery" would have us pushing inflation up by now, and interest rates with it. I think this is keeping the stock market propped up as it were because dividend yields often are well above CD yields for the more staid stocks. PG I think is trading on the dividend and their history of increases as a depression hedge.
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And on cue, the market reverses and is up strongly on trade deal "news" on China.
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Someone explain this yield curve and dumb it down for me so I can get it. I'm THINKING it means that investors don't trust a LONG term investment? Â
https://www.cnbc.com/2019/08/13/us-bonds...iment.html
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If you plot interest rates on say Treasuries versus maturity (how long until the bond matures), you get a yield curve. Usually, it starts lower at shorter terms and increases as you go to 2 years, 10 years, 30 years. A "normal" yield curve might have say 2% interest at 90 days, then 2.5% at 2 years, 3.0% at 10 years, and 4.0% at 30 years.
A reversal is simply when the longer bonds, typically the ten year, yields less than the shorter, typically the two year. We're very close right now to a "10/2 inversion". which is taken as a recession signal.
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(08-13-2019, 10:01 AM)cincydawg Wrote: If you plot interest rates on say Treasuries versus maturity (how long until the bond matures), you get a yield curve. Usually, it starts lower at shorter terms and increases as you go to 2 years, 10 years, 30 years. A "normal" yield curve might have say 2% interest at 90 days, then 2.5% at 2 years, 3.0% at 10 years, and 4.0% at 30 years.
A reversal is simply when the longer bonds, typically the ten year, yields less than the shorter, typically the two year. We're very close right now to a "10/2 inversion". which is taken as a recession signal. Thanks.
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Currency Wars: Swiss Central Bank Poised to Cut Interest Rate to -1.0%... https://www.bloomberg.com/news/articles/...t-rate-cut
The Swiss National Bank may have to do more than pump billions into foreign exchange markets into prevent the franc from appreciating to a damaging level... an increasing number of economists also expect the SNB to reduce its benchmark interest rate to -1.0%. Five respondents of 17 in Bloombergâ€s monthly survey now see a cut of up to 25 basis points this quarter, compared with just one in July.
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A decade ago, if you had asked me about "negative interest rates", I would have looked askance.
https://tradingeconomics.com/germany/interest-rate
Germany also has gone negative with the interbank rate.
These are strange times, tenth year of a recovery and very low inflation and interest rates in the US, very low UE and modest wage increases. I made out pretty well today in the market, even with being heavy in cash and bonds.
I still think our economy is weakening and the Fed will cut rates again a couple of times to try and head that off.
Greenspan... Negative yields? Who cares? It's meaningless. https://www.bloomberg.com/news/articles/...ury-yields
Alan Greenspan is wrong. Negative yields are meaningful... meaningful as in tolerance for paying interest is waning and central banks cannot cram more debt into the system. Yields are negative because central banks manipulate yields negative. Yields would never "go negative" on their own.
Don't listen to the salesman trotted out explain how zero/negative rates are much ado about nothing. Trust GOLD. Trust SILVER.
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