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Gold/Mining/Energy : Blue Chip Gold Stocks HM, NEM, ASA, ABX, PDG

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To: Wade who wrote (44417)	6/11/2013 11:29:04 PM
From: Wade	Read Replies (2) of 48092

<The stock market will be sacrificed for the UST market. We shall see.> The Fed had to enter the UST market to rescue it after the yields broken out sharply to the upside. No one to rescue the equity market. Still think the risk is not in the equity market? Hmmm.. Good to see the Turd wrote a nice piece to investigate what has been happening. Paper Talk tfmetalsreport.com The yield on the 10-year note is now up to 2.23%. That may not seem like much but, when you consider that not too long ago is was yielding near 1.40%, you realize that rates have moved up by more than 50% in the past 8 months. That's a lot. The acceleration in the decline since early May suggests only two possibilities: 1. The discussion of a "Fed taper" isn't just talk...it's actually happening. Right here and right now. The reduced demand from The Fed leaves more sellers than buyers and bond prices are falling. 2. The Fed has not begun to "taper" and is, instead, still directly monetizing $45B/month, augmented with the $40B/month in corporate welfare MBS purchases from the Primary Dealers. Selling by all of the other market participants is overwhelming The Fed's daily bid and driving prices lower. ..more "Even leaving out the $40B/month in MBS purchases, The Fed is still directly monetizing $45B/month in treasury debt. Regardless, in the past month alone, bond prices have fallen by 5 points and rates on the 10-year note have backed up from 1.6% to 2.2%. Jeez Louise! It's as if there is currently no other buyer of bonds in the U.S. Every other market participant is selling! They have to be in order to swamp and over-run the Fed's daily bid to this extent. So, who are these sellers?" "And, finally, this is where it gets really, really dangerous. If current holders of treasuries, treasury futures and treasury derivative contracts continue to sell regardless, the amount of QE needed to stem the tide and support the bond market will grow exponentially. This is where ole Ben is truly playing with fire. He may believe that he is all-seeing, all-knowing and all-powerful but...if the global market chooses to over-run him...panic, chaos and hyper-inflation will follow.Still thinking about converting your physical metal back into fiat? I hope not."

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