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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: JDinBaltimore who wrote (30667)	2/6/2000 11:51:00 AM
From: Lee	Read Replies (1) \| Respond to of 50167

Hi John,..Re:.It seems to void the "Futures/Forward" concept, of taking risk on delivery at a future date is worth less than sitting at cash. If I had to guess, it would be that it has to do with short term rates, 2 yr and 10 yr treasuries versus long rates. This is strictly a guess but since we have an inverted yield curve, short term costs are out of synch with long term now. <g> bloomberg.com Cheers, Lee

To: JDinBaltimore who wrote (30667)	2/6/2000 6:17:00 PM
From: GROUND ZERO™	Respond to of 50167

I think when the phenomenon occurs, it suggests that the deferred months are expecting less of a rise in prices than otherwise, perhaps a bear move... the deferred months could have such severe backwardation that they would move to a discount to cash... not a good sign for a bull market.....<g> you can see what appears to be constant backwardation in the bond futures, but only because that market is an inverted market to cash to begin with... there really is no backwardation, but it gives that appearance since the further out you go in the bond futures then more of a discount to cash the price is..... granted, it is confusing... now you see why no one wants to talk about it.....<g> GZ