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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (25358)	1/26/2005 11:06:26 AM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 110194

just because nobody answered your question doesn't mean you're right. it probably depends on Greenspan's target audience. in the case of institutional investors, i think he meant try to shorten duration. in the case of individuals, i think he meant you'd be stupid to buy long bonds. now thanks to the flattening of the yield curve, there is not much compensation for term risk.

To: mishedlo who wrote (25358)	1/26/2005 11:23:54 AM
From: John Vosilla	Respond to of 110194

<Anyone hedging by being short LT treasuries has probably lost their ass.> That is a minor factor in the whole frame of things. LT treasuries didn't make new lows in rates for 6 years from 1986-92 and 4 years from 1994-98. Geenspan attempted to avert a depression this time by reflating real estate and getting the general public to believe cash is trash by further consuming and borrowing beyond their means. He succeeded beyond his wildest dreams but now all still leveraged in the carry trade will have to pay the consequences of this massive misallocation of capital one way or the other.