Story at WSJ here.
The yield on the five-year Japanese government bond hit zero for the first time ever, while that of the benchmark 10-year hit a record low 0.255%.Meanwhile in the US, the 30-yr is also now headed toward record lows, 10-yrs should not be far behind. Story here at Reuters.
strong demand at a three-year Treasury note auction fed buying for U.S. government debt, driving 30-year yields to near-record lows.
I guess the "vigilantes" are in retreat! LOL!
Good thing the Fed stopped doing the QE in November and allowed this nice little bond rally to ensue.
Where's Kyle Bass now? LOL!!!
ReplyDeleteDollar bills / yen bills are a central bank liability on which it pays no interest. Now that there’s no interest on 5 year Japanese debt, the latter is virtually the same as yen bills or base money.
ReplyDeleteSo what will Rogoff and Reinhart make of this? They’ve claimed that larger than normal debt equals disaster, but they’ve never been too worried about a larger than normal monetary base.
Perhaps they’re consulting a psychiatrist...:-)
Kyle Bass is in Sweden today. Worth reading. He and Soros were buying YPF when oil was a 100 bbl! He says he is "75% short yen, 25% short japanese rates." I'll bet they are bleeding red on some of his ideas. Some are okay though.
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