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Fuggedaboutit! Treasury Supply Ain’t Going Away

Despite what the pundits tell you, and despite the massive rally in the Treasury market over the past few days, the problem of Treasury supply isn’t going away. These rallies have come along like clockwork ever 6 months since the bear market started 40 months ago. This one gets its start from the same conditions that spawned the last 3 rallies. So is this time different? Non-subscribers, click here for access.

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No. Non-subscribers, click here for access.

Last week the Treasury reported out its quarterly refunding data, including the TBAC forecast for the next 5 months. Again, the Wall Street captured media was happy to report that the top was in in yields for the umpteenth time, and therefore the bottom was in for the bear market in bonds. The bear market that they seemingly just noticed in the past 4 weeks. When the 10 year hit 5%, the pundit parade hit the streets and the airwaves to declare that the top was in (bottom in prices). Just like all those other times Wall Street correctly called a bottom or top in any major market right on the button. Remember those times? Non-subscribers, click here for access.

So let’s look at a few facts, along with the charts of the 10 year yield to get an idea of just how far this latest rally will go, and to look at whether, indeed, the Treasury market low (or high, depending on which side of the coin you are viewing) is in for good. Non-subscribers, click here for access.

After doing that, as shown in the following pages, I came away with this: Non-subscribers, click here for access.

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Posted in 1 - Liquidity Trader- Money Trends, Fed, Central Bank and Banking Macro Liquidity
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