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The Bond Strategist
The Bond Strategist
10899 members
11 questions
15 posts

I am going LIVE here in my exchange Thurs/ 5pm EST answering questions around the Macro View of Bond Strategy . Post your questions here NOW and I will be answering them in real time when I go live!

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Bonds

Welcome to my Real Vision Exchange, The Bond Strategist!

Please watch my intro video. I look forward to interacting with you all soon!

 

https://vimeo.com/465105087

A good thread that explains the need for the Fed's Market Functioning version of QE... Hopefully, as I mention, RV ... these points via my earlier RV videos.

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Bonds

Taking the 30yr buzz on twitter to the exchange in case RV folks want to discuss it more here...

RV Exchange Special Posting: Explaining this chart and my views around it...

I once used this chart in an RV video but there is a lot to unpack here...

First off, please do try to follow the lines and go from left to right to appreciate the evolution from a domestic-based bond market to a brief period of foreign dominance to a more balanced ownership structure, especially now with the Fed filling in the cracks.

Second, none of this should come as a surprise, but how we got to where we are today in terms of who owns what in the Treasury market was a carefully laid out series of plans and policy changes. Now, I am not implying that they had some master plan with all these new regulations in mind already built out in the 1970s, but part of the move to building the USD global reserve status started here as well its linked back to the petrodollar agreements.

Third, the Fed has scope to buy a lot more Treasuries (and its not as if the US will stop spending soon - the opposite will occur regardless who sits in the White House next year). That said, unless the US signs off on some new currency arrangement (I know I am going to get some push back here - in that - the US might not have a choice - I differ on that) the Fed will not want to end up with close to half the US bond market (unless we are at war).

So this really does suggest... (More)