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Strategies & Market Trends : Stock Attack II - A Complete Analysis
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To: Terry Whitman who wrote (24662)11/23/2001 2:28:33 PM
From: isopatch  Read Replies (1) of 52237
 
Terry. Definitely a move up in Tsy yields here

based on:

1. ST snap back in economic stats from the immediate post 9/11 plunge.

2. And the fear $$$ that piled into Treasuries after 9/11 now exits on major success in the Afghan chapter of the War on Terrorism.

But LT, the article you referenced provides further evidence confirming the primary trend as deflationary.

<On Nov. 1, the Bureau of Economic Analysis at the Department of Commerce released third-quarter
personal consumption expenditure data — a more sophisticated version of the consumer price index —
and for the first time since 1954, it fell…0.4% on an annualized basis. Prices actually went down.

Then last Thursday, the Bureau of Labor Statistics at the Department of Labor released October import
prices — down 2.4%.

Then last Friday, the same folks released the October producer price index — down 1.6%, the largest
drop in history.>

I'd use this bump up in yields to establish, or add to, positions in medium grade fixed income securities. Plenty of BBB- to A+ S&P rated bonds and preferreds in the 8 to 8 3/4% yield range.

I'm a little too conservative to play with junk. But those with the risk profile are playing there also.

Cheers,

Isopatch
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