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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: patron_anejo_por_favor who wrote (160729)	10/28/2008 11:48:32 AM
From: Smiling Bob	Respond to of 306849

When the story of gold shortages starts hitting MSM, watch out. Panic buying?

To: patron_anejo_por_favor who wrote (160729)	10/28/2008 12:19:00 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 306849

marketwatch.com Treasurys decline on poor auction demand U.S. pays up for first $6 billion chunk of week's $64 billion in bond sales By Deborah Levine & Kate Gibson, MarketWatch Last update: 3:44 p.m. EDT Oct. 27, 2008 NEW YORK (MarketWatch) -- Treasurys fell on Monday, with yields rebounding from overnight lows, after the government's sale of $64 billion in short-term securities drew lackluster demand, raising concern about the outcome of auctions slated for later in the week. C rose 6 basis points, or 1.7%, to 3.75%. Prices move in the opposite direction of yields, which earlier fell as low as 3.60% as global stock markets dropped. Kevin Giddis, head of fixed income at Morgan Keegan, expects "another volatile week for stocks and bonds which are keeping the fingernails of most traders trim and a long line at drugstores for stomach medicine." Stocks turned more positive after a government report showed new-home sales rose 2.7% in September to a 464,000 annualized pace, a little better than expectations of economists surveyed by MarketWatch. Futures traders are betting the Federal Reserve will lower its target interest rate by at least half a percentage point to 1% after its meeting on Tuesday and Wednesday. See The Fed. The price of the November federal-funds-futures contract implied a 77% chance that the U.S. central bank will cut its target rate to 0.75%, which would be the lowest on record. December futures show traders expect another cut that month, taking the funds rate even lower. This week, Fed officials will also update their quarterly economic forecasts. TIPS auction The Treasury Department sold $6 billion in five-year inflation-indexed debt to yield 3.27%, much higher than the debt was trading before the auction. Bidders offered $1.81 for every dollar of debt available, compared with a so-called bid-to-cover of more than $2 at the last four auctions. The auction was "awful" because there were no participants, said Andrew Brenner, co-head of structured products and emerging markets at MF Global. The sale is a reopening, meaning the debt sold will mature at the same time and carry the same coupon as at the last sale of the maturity in April. The Treasury Inflation Protected Securities, or TIPS, yield 0.69% more than regular five-year notes TIPS usually carry a yield lower than regular Treasurys of the same maturity because they add a payment for the rate of inflati on when they mature. TIPS through 2013 are now negative, which is highly unusual and indicates investors expect deflation over the life of the debt. Shorter-term maturities also remain under pressure as traders set up to bid for $34 billion in two-year notes on Tuesday and $24 billion in five-year notes on Thursday. The amounts match last month's as the largest on record.