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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Chispas who wrote (56956)	9/24/2006 9:36:53 AM
From: Moominoid	Read Replies (1) \| Respond to of 116555

That's about when I am expecting 3 of C down to be happening :)

To: Chispas who wrote (56956)	9/24/2006 7:47:36 PM
From: mishedlo	Read Replies (3) \| Respond to of 116555

Bill Cara.... The T-Bill yields crashed this week. I knew in my heart a week ago something big was coming down. This week, the 30-year T-Bond yield has dropped -17 basis points from 4.90 to 4.73 pct. The 10-year dropped -20 bp from 4.79 to 4.59 pct. The 5-year dropped -22 bp from 4.75 to 4.53 pct. The 2-year dropped from 4.79 to 4.67 pct, which was a move of -10 bp. These are serious moves. And yet the Fed rate, charged to commercial lending banks, is at 5.25 pct. Even the 3-month T-Bill yield dropped -1 bp to 4.78 pct. When there is a negative spread of 47 basis points between the Fed rate and the T-Bill yield, there will be no new loans that make money, so effectively business and investment is being cut off. This is a panic move to put capital into bonds before a crash in equities. It is an attempt to save the housing industry and keep the U.S. economy afloat. I wouldn’t accept the veracity of a single economic data point from this point forward that has the faintest odor of Washington on it.