Treasuries stabilizing even as debt ceiling approaches... interesting.
Good morning AR readers and members and as I wrote on Monday has held true with average of 30-50bps swings up and down each day today brought us a gap up open of +22bps to reverse some of yesterdays losses, that reversed that previous days gains.
So today we are now 4 days closer to the debt ceiling D-Day of Monday 8/2/11 and treasuries are actually up a bit the 10Y is currently below 3.0% on its yield and the FNMA bond is almost a 1/4 higher in its pricing.
Here is today's headline news that is helping drive the markets...
So one would be led to believe that with continuing claims basically flat and initial claims being down 20k that we should see stocks rally a bit and bonds suffer but its the opposite right now. I have to assume there must be some insight that the feds will absolutely not default on our debts and that an agreement to increase and coupled with a way to start bringing our sky high debt down must be close to completion.
Only time will tell on this but I ask for you input. Do you agree with me that the indicators of this week show a high probability of Debt Increase packaged with real Debt Reduction is near completion or do you think we will see politics of old and a party line stand off? I am interested in hearing all comments.
Have a great day and be positive!
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