Hey Mo,..Re:. It is one of these two things if you ask me,either Greenspan talks too much or the market pays too much attention to his vague and often repetitive pronouncements.
The bond market shot down this morning, before AG's speech, on rumors that the jobs report to be released tomorrow got released today and the new jobs created was 300k. That's rumor number 1 and corresponds to the movement on TYX from 5.7 to 5.74.
Now, what's going on now is just traders agonizing over AG's comments about the shrinking labor supply which, if anyone had been paying attention, he's been saying for almost a year now.
Also, I didn't read anywhere in his speech where he said equity prices might be 'unjustifiable' but I could have missed it. I thought it was a very upbeat speech. He actually didn't say anything new. We have heard before about tight labor markets but the economy keeps creating jobs and somehow we keep finding people to fill them without the accompanying dreaded wage inflation. <g> I read most all he says by the way so I think the sell-off is just a continuation of what we've been seeing plus a lot anxiety over the number tomorrow! <VBG> Plus some technical levels on bonds got taken out which automatically triggers more selling!
US 30-yr bond falls pt, fund selling, techs weigh
biz.yahoo.com
Keep cool, it's just a shakeout. <g> Some media try to pick out the negative in everything! Anyway, MSD already floated his bonds at a lot lower rate last summer! <g>
GREENSPAN: IF PRODUCTIVITY 'FALTERS' INFLATION TO REEMERGE
economeister.com
Explaining why inflation has not only stayed low but has "continued to ease" by some measures, Greenspan minimized the importance of "one-off events" like lower commodity import prices and dollar appreciation and stressed the importance of the "decline in the rate of increase in unit costs of output" caused by increasing labor productivity.
Greenspan said there is good support for "the hypothesis that the
recent acceleration in labor productivity is not just a cyclical
phenomenon or a statistical aberration, but reflects -- at least in
part -- more deep-seated, still developing, shift in our economic
landscape."
Keeping cool,
Lee |
