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Treasury Bonds
Treasury Bonds
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My fellow exchangers, please help me figure something out:

While watching a masterpiece on RV from October the 7th, the interview Featuring Jeffrey Snider and Steven Van Metre, I have come across really nice comment by Rob S. Bonds are not my expertise, thus I beg you to teach me. I understand Steven's thesis, how QE is basically deflationary and is pushing yields lower, but I'd love to find somebody who would help me figure out, what parts of the comment Rob S. has written are false:

"#1 - The conversation focused on QE limited to bank reserves. However, below are a number of examples that sure look like the Fed is directly or indirectly infusing money outside of bank reserves. I would appreciate if each of these items were addressed.

1.a – Mortgage Backed Securities. Roughly speaking, a bank creates money, lends it as a mortgage, then sells the mortgage which eventually ends up on the Fed balance sheet. The bank sold an asset, didn’t they receive money?

1.b – Bond ETF. Roughly speaking, the Treasury gave the fed ‘capital’ which the Fed leveraged by 10x and purchased Bond ETF in the general public (not limited to bank reserves) which ended up on the Fed balance sheet. Technically, whoever sold the ETF indirectly received Fed money.

1.c – PPP. This appears to be a two-step process. First step, roughly speaking, is Congress told the banks to create money, give out a loan, forgive the loan, get reimbursed by the Fed. Second step, roughly speaking, the Treasury gave the... (More)

US30-US05 curve motoring higher, above 130bp this morning, up 110bp since early July now, this is a super crowded trade that's doing very well for the street

On balancing an irresponsible long-BTC position with a *hopefully* less irresponsible long-TLT position


I have a position in bitcoin, which is my primary inflation position. I'm looking for a similarly aggressive deflationary position. I think I want to buy a spread of long-dated, at-the-money calls on TLT. I'm sizing the position so that if I paid the strike price for each contract today, the value of the resulting position would equal my current bitcoin position. The idea is to cover my ass. Am I wrong?

New investor here:

I've been watching a lot of YouTube, listening to a lot of podcasts, and generally drinking from the Real Vision firehose. I'm mostly following @Lyn Alden, @Raoul Pal, Diego Parrilla, Steve Van Metre, Preston Pysh, Jason Buck, etc... But, I know I don't know more than enough to be dangerous. So, my strategy is to assemble a "Dragon Portfolio" ala Christopher Cole. This has been relatively straightforward when it comes to stocks and gold, and I think I have good solutions to commodity trend and volatility. But, what I don't really want to do is establish a position in bonds. Call me crazy, I don't feel like owning debt is the best trade.

But the dollar bulls, and my belief that we're looking at huge deflationary pressure from demographics, technology, and debt, has me looking for a pure-play deflationary hedge. So, that's what leads me to TLT. In a deflationary environment, it seems like long-duration treasuries is a safe bet, but the recent price action is not encouraging. I find myself... (More)

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.