Skip to main content

2 questions
13 posts

Do you have questions about yields?

Log in to ask questions about yields publicly or anonymously.

Sam ColtExChangemaker
"So called Business Engineer"

For those of you worried about real yields and inflation.

From the DB default study 
From the DB default study 

I have the full default report dm me if you want it. 

The Macro Cafe. Episode 11.

Bitcoin revving engines, gold happy again, sp500 nice trend, oil on the the "risk on" trade is alive and well. Let's dive into the charts.

What is causing yields to go up?

  • There is a record short in the 30Y.
  • US fiscal authorities are spending like drunken sailors.

They are probably selling the 30Y to fund other inflation bets.  They may be right, but I suspect the Fed is not bullshitting us when they say current inflation is transitory.   Till I see the demand-side accepting the higher prices, this supply-side inflation is all part of the gameplan for the Fed to try to debase the debt priced in fiat.  It will hurt people, but this is the path chosen.  Adapt or die.

Meantime, it makes TLT a decent long vol inflation hedge to cover the downside in case they are wrong.  Though I am starting to like gold better to be honest.  If I am wrong and inflation shows up, it will perform better because it is tied to real yields.

Is there any scenario where it’s possible to have yields up, USD up (either dxy index up or the SL fed trade weighted dollar up) & spx up at the same time? Or does one have to be the release valve?

Edit:   I realize how poorly worded this question was.   My apologies.   

Can there be a market regime where treasury yields are elevated, the USD, either measured in DXY index or SL feds traded weighted dillar index, is elevated and at the same time spx/equities keep climbing.   Has such a sustained regime happened before?