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T-bills GOOD, T-bones B-A-A-A-DDD!


machinehead

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What if long Treasury rates really are headed for a two-handle, as you've said in the past?

 

It would still be prudent for a large borrower to ensure that only a limited portion of its bonds have to be rolled over every year. This provides predictable costs, and limits the scope of any funding crisis.

 

But also, it gives the authorities an incentive to keep inflation and long term rates low.

 

The Federal Reserve believes (apparently with reason) that it can control yields at the short end of the curve. Is the new ABAT (All Bills, All the Time) policy a declaration that they would let long bond yields soar into double digits, if necessary, while they hold the Fed funds at 1% "indefinitely" for the borrowing convenience of the Treasury, the banksters, and the leveraged speculating community?

 

I would call that a gold bug's wet dream. Silver, too!

after the treasuries rather stunning admission yesterday,

one has to wonder just where we'll end up in say... 2007.

 

the inverted debt carry ponzi at the treasury reads like

THE creature from debt lagoon.

 

bonds, notes & bills have been turned upside down. this

strategy of borrowing short and lending long has begun

to compress.

 

compressing treasury debt into a narrower "window" is

suicide.

 

al's rate cut follies have allowed the second largest

gamble in history to follow in the footsteps of FNM/FRE.

 

the 1-2 punch will be devastating. it's wholly misrepresents

risk and it's carry costs moving into refunding's.

 

it completely confirms my thesis the equities markets will

be drained on the back of M3's intentional drain. in

addition this coincidess with a rapid decline in liquidity

outside the conventioanl banking system in the netherworld

of noland's "credit bubbles".

 

liquidity is being herded now, this is the primary tool,

not additional liquification.

 

there is plenty of money stock sloshing around and more

returning home daily via dollar carry unwinds.

 

this is why M3's roc's are pointing to china,literally.

 

corporate issuances are peaking again, as they do when the

equities markets are approaching a change of trend.

 

consumer credit has floated "debt hope", another far more

dangerous bubble, in order to stem demands on muni's & ust's.

 

now it's payback...

 

the herd, imo is about to feel the range's expanse suddenly

and violently collapse inward.

 

sending the chattel in many directions.

 

as most of you know, i do not buy into the election proppage

into jan of 05 or november of 04, for that matter.

 

there is a monumental shift brewing... one that's going to

shock and awe even the most strident bull.

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al's rate cut follies have allowed the second largest

gamble in history to follow in the footsteps of FNM/FRE.

 

the 1-2 punch will be devastating.

OMG ... are you saying that the Fed and Treasury will "save themselves" with their administered 1% borrowing rate, while hanging poor Freddie and Fannie out to dry as long Treasury yields go parabolic? :o

 

That's one way to win a regulatory battle, hey ... "hardball." :lol:

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al's rate cut follies have allowed the second largest

gamble in history to follow in the footsteps of FNM/FRE.

 

the 1-2 punch will be devastating.

OMG ... are you saying that the Fed and Treasury will "save themselves" with their administered 1% borrowing rate, while hanging poor Freddie and Fannie out to dry as long Treasury yields go parabolic? :o

 

That's one way to win a regulatory battle, hey ... "hardball." :lol:

 

as carter's uber-wit, chris mathews would say...

 

"let's play hardball !"

 

machinehead, isn't the very core of fascism "regulatory control"...

 

the entire sordid mess "appears" to be on a collision course, those outside the "system" taking the heat.

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al's rate cut follies have allowed the second largest

gamble in history to follow in the footsteps of FNM/FRE.

 

the 1-2 punch will be devastating.

OMG ... are you saying that the Fed and Treasury will "save themselves" with their administered 1% borrowing rate, while hanging poor Freddie and Fannie out to dry as long Treasury yields go parabolic? :o

 

That's one way to win a regulatory battle, hey ... "hardball." :lol:

have a theory wanna run by you MH:

 

a "bell shaped" yield curve.

 

backload the returns and viola a 50 year note duration.

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al's rate cut follies have allowed the second largest

gamble in history to follow in the footsteps of FNM/FRE.

 

the 1-2 punch will be devastating.

OMG ... are you saying that the Fed and Treasury will "save themselves" with their administered 1% borrowing rate, while hanging poor Freddie and Fannie out to dry as long Treasury yields go parabolic? :o

 

That's one way to win a regulatory battle, hey ... "hardball." :lol:

have a theory wanna run by you MH:

 

a "bell shaped" yield curve.

 

and a 50 year note.

I could imagine that under some special circumstances. Remember "flower bonds" -- Treasury issues that were accepted at par for payment of estate taxes?

 

One way for them to shovel bonds down people's throats when rising inflation makes them unattractive is to attach tax benefits to bribe buyers. Hold Treasuries in your portfolio and shelter regular income, or capital gains (puffed up by inflation).

 

Or something like that. Desperate times require desperate measures.

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al's rate cut follies have allowed the second largest

gamble in history to follow in the footsteps of FNM/FRE.

 

the 1-2 punch will be devastating.

OMG ... are you saying that the Fed and Treasury will "save themselves" with their administered 1% borrowing rate, while hanging poor Freddie and Fannie out to dry as long Treasury yields go parabolic? :o

 

That's one way to win a regulatory battle, hey ... "hardball." :lol:

have a theory wanna run by you MH:

 

a "bell shaped" yield curve.

 

and a 50 year note.

I could imagine that under some special circumstances. Remember "flower bonds" -- Treasury issues that were accepted at par for payment of estate taxes?

 

One way for them to shovel bonds down people's throats when rising inflation makes them unattractive is to attach tax benefits to bribe buyers. Hold Treasuries in your portfolio and shelter regular income, or capital gains (puffed up by inflation).

 

Or something like that. Desperate times require desperate measures.

extend the exemptions beyond state/local to federal...

 

encouraging "flower bondage".

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I could imagine that under some special circumstances. Remember "flower bonds" -- Treasury issues that were accepted at par for payment of estate taxes?

 

One way for them to shovel bonds down people's throats when rising inflation makes them unattractive is to attach tax benefits to bribe buyers. Hold Treasuries in your portfolio and shelter regular income, or capital gains (puffed up by inflation).

 

Or something like that. Desperate times require desperate measures.

Or, government could just require every working people to buy with certain percentage of their monthly pay. It already requires emloyers to withhold taxes. So, it is would be a simply procedure to go from the existing social security tax scheme.

 

In early 1980s when Chinese government, after printing a lot money, decided the issue the debts to avoid making inflation worse. At the time, there was no market to unload the debts. So, it required every salary receiver to purchase the 5-year national debts with certain percentage of his money.

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In early 1980s when Chinese government, after printing a lot money, decided the issue the debts to avoid making inflation worse. At the time, there was no market to unload the debts. So, it required every salary receiver to purchase the 5-year national debts with certain percentage of his money.

The very same thing happened in Bulgaria in the 40s (except that they had used longer-term bonds, I think), when the communists had just grabbed the power but the country was essentially bancrupt from the war. I remember, when I was a child, my grandmother was giving me these "government bonds" to play with. Some of them still had the coupons and some had even matured - but my grandparrents hadn't bothered to reclaim the principal - because, by that time, it was worth basically nothing (due to the inflation, three orders of magnitude had been removed from the currency; i.e., a 1,000-lev bound would be worth only 1 lev) - it wouldn't even pay for the bus ticket to the place where they could get the money...

 

Basically, my grandparrents considered this forced buying of government bonds as some kind of stealing - a relatively benign form of it, compared to the other forms the communists had practiced...

 

Never underestimate the number of ways the powers that be can screw you up.

 

Regards,

Vesselin

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Thanks for the descriptions, EasyAl and Bontchev.

 

The U.S. pegged long Treasury rates at 2.25 to 2.5% during WW II and afterward, from 1942 to 1951.

 

Big public campaigns were conducted, urging people to "buy war bonds." Few other investments were available, and few consumer goods to spend it on. Many employers offered payroll deduction plans.

 

Theoretically it was voluntary. But if you worked at an industrial plant, it was probably almost obligatory.

 

What will they call them this time around - WIN (Whip Iraq Now) bonds?

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Thanks for the descriptions, EasyAl and Bontchev.

 

The U.S. pegged long Treasury rates at 2.25 to 2.5% during WW II and afterward, from 1942 to 1951.

 

Big public campaigns were conducted, urging people to "buy war bonds." Few other investments were available, and few consumer goods to spend it on. Many employers offered payroll deduction plans.

 

Theoretically it was voluntary. But if you worked at an industrial plant, it was probably almost obligatory.

 

What will they call them this time around - WIN (Whip Iraq Now) bonds?

I do not know how much pressure average working guy/gal in this country feel from their employers to make some sorts of contribution to the charities of employers' choice.

 

WSJ today had an article on the suit filed by an ex-BOA employee who accused his superiors to force him to make personal contribution to their charities and political organization.

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Thanks for the descriptions, EasyAl and Bontchev.

 

The U.S. pegged long Treasury rates at 2.25 to 2.5% during WW II and afterward, from 1942 to 1951.

 

Big public campaigns were conducted, urging people to "buy war bonds." Few other investments were available, and few consumer goods to spend it on. Many employers offered payroll deduction plans.

 

Theoretically it was voluntary. But if you worked at an industrial plant, it was probably almost obligatory.

 

What will they call them this time around - WIN (Whip Iraq Now) bonds?

They will be called BOOB Bonds. Bail Out Our Bush

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Thanks for the descriptions, EasyAl and Bontchev.

 

The U.S. pegged long Treasury rates at 2.25 to 2.5% during WW II and afterward, from 1942 to 1951.

 

Big public campaigns were conducted, urging people to "buy war bonds." Few other investments were available, and few consumer goods to spend it on. Many employers offered payroll deduction plans.

 

Theoretically it was voluntary. But if you worked at an industrial plant, it was probably almost obligatory.

 

What will they call them this time around - WIN (Whip Iraq Now) bonds?

They will be called BOOB Bonds. Bail Out Our Bush

roflmao bob. how can i not afford to buy a dozen?

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yobob was just being political.

 

The real acronym, of course, is "Bail Out Our Bubble."

 

And that's no joke. :o

perhaps it's me...

 

blowing soapy bubbles in the wind as a child, i never saw one deflate.

 

without exception, they popped.

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