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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: mishedlo who wrote (48511)12/31/2005 8:19:11 AM
From: Wyätt Gwyön  Read Replies (1) of 110194
 
Chicken Feed by Tom Sullivan
Bondholders have little to show for their efforts in '05.

The Treasury component of the Lehman Brothers U.S. Aggregate Index for intermediate maturities returned barely than 1.5% in 2005, which was "rather disappointing," says Gary Pollack, a managing director at Deutsche Bank Private Wealth Management. The huge U.S. trade deficit piled dollars offshore, which foreign central banks plowed back into U.S. investments, including Treasuries and the implicitly federally guaranteed debt of mortgage lenders Fannie Mae (FNM) and Freddie Mac (FRE). "Without foreign investment, 10-year yields would be 100 basis points [one percentage point] higher," he reckons.
online.barrons.com
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