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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (112237)	10/10/2018 9:19:26 PM
From: robert b furman	Read Replies (3) \| Respond to of 220897

I think you are right when it comes to Quantative tightening. But rate increases are over for the year. The fed raised rates by 1/4 point this month and last June. Before the Rate increase in June the 10 year treasury was yielding 3.13ish. Today after two 1/4 point rises it traded unchanged at 3.17%. Their raises are impotent. Now retiring debt does take money out of the market. The fed is retiring Real estate mortgage backed securities and treasuries both are capped at their monthly maxes. If people are making mortgage payments to Fannie and Freddie and that reduces the need for RMBS - I say retire them and get out government out of the mortgage business. That should not hurt our economy - to have consumers under less debt. When a treasury retires and the fed no longer reissues it - the treasury pays the fed and that removes money from the system. That does reduce the supply of money,but when the Fed raises rates and there is such a rush to catch the higher yield that the 10 year can not hold the new rate - based on free market fundamentals - I don't think the fed can push that string. Now Libor has slowly risen during the Fed funds rate increases but not in a way that sincs with the half point rise. When the Fed stalls rate increases - that should be a big day! One thing I do know is: They do not call me. Bob