Friday, July 1, 2022
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Bonds catch a bid – The Reformed Dealer


It began within the bond market, it has to finish there. Till there’s a bid for Treasurys – at the least quick and intermediate time period Treasurys, the inventory market can not stabilize. I noticed the massive Treasury bond ETFs cease taking place Friday, however I held off till immediately on the shut earlier than posting this.

I don’t know if that is only a approach station earlier than a brand new set of decrease costs / greater yields. However I consider, strongly, that there are trillions of {dollars} managed by swimming pools of capital that will very gladly settle for a 3% annual return on their cash given the place charges had been relative to inflation simply six months in the past. So, I’m hopeful, I suppose, that we have now seen the speed play out – the worst of the transfer is behind us now and costs have reset to a extra engaging place.

But when not, there’s no hope for shares to have bottomed. It’s like these motion pictures the place the band of adventurers should comply with the monster again to its cave and kill it the place all of it started to be able to rid the land of its menace. Assume Beowulf or The thirteenth Warrior. The bond bleeding should cease first earlier than the inventory correction can finish.

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