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Re: Inversion countdown
Old 11-26-2005, 03:43 AM   #21
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Re: Inversion countdown

The inverted curve is a less accurate predictor than in days of yore. Businesses can get money from a greater number of sources now a days than just banks. At least that is what Alan G stated, when asked about inverted rates by a Congressman.
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Re: Inversion countdown
Old 11-26-2005, 03:54 AM   #22
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Re: Inversion countdown

For the time being, and knowing that the trend is your friend until it bends, the USD goes north against the euro and most other currencies...
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Re: Inversion countdown
Old 11-26-2005, 04:44 AM   #23
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Re: Inversion countdown

Quote:
Originally Posted by Michael
* Businesses can get money from a greater number of sources now a days than just banks.*
Also true of individuals.

JG
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Re: Inversion countdown
Old 11-30-2005, 03:33 PM   #24
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Re: Inversion countdown

Partial inversion-

3 Month 3.76
6 Month 4.11
2 Year 4.40
3 Year 4.39
5 Year 4.41
10 Year 4.49
30 Year 4.70

The 2 year is now higher than the 3 year, only 1bp less than the 5 year, and 9bp away from the 10 year. We're really close...
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Re: Inversion countdown
Old 11-30-2005, 03:57 PM   #25
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Re: Inversion countdown

Oh no! What should I do in the event of a yield curve inversion? Is it time to start hoarding bottled water, canned food, and shotgun shells to ward off looters?
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Re: Inversion countdown
Old 11-30-2005, 04:03 PM   #26
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Re: Inversion countdown

It suggests a recession is around the corner. No need to start hoarding your bread and eyeing the family pets with future meals in mind; just don't go running out and buying speculative equities and so forth.
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Re: Inversion countdown
Old 11-30-2005, 04:26 PM   #27
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Re: Inversion countdown

Quote:
Originally Posted by brewer12345
It suggests a recession is around the corner. No need to start hoarding your bread and eyeing the family pets with future meals in mind; just don't go running out and buying speculative equities and so forth.
brewer:

I think I heard the Fed is talking up "inversions don't matter" too.

What a great country.

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Re: Inversion countdown
Old 11-30-2005, 04:56 PM   #28
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Re: Inversion countdown

I have read those comments too. Also of note is that they will no longer be publishing M3 as of March 23, 2006.... I had hoped to keep an eye on it (as well as M3 velocity)....
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Re: Inversion countdown
Old 12-01-2005, 06:55 AM   #29
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Re: Inversion countdown

How about intermediate-term bond funds? I'm tired of watching my NAVs drop month after month.

Quote:
Originally Posted by brewer12345
It suggests a recession is around the corner.* No need to start hoarding your bread and eyeing the family pets with future meals in mind; just don't go running out and buying speculative equities and so forth.
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Re: Inversion countdown
Old 12-01-2005, 07:00 AM   #30
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Re: Inversion countdown

Quote:
Originally Posted by soupcxan
How about intermediate-term bond funds? I'm tired of watching my NAVs drop month after month.
If you can time it right, really long treasuries are the exactly perfect investment (that and short equities/bear mutual dunds). But its tough to time these things and in the mean time LT treasuries involve a lot of interest rate risk. I think medium term bonds are probably a good compromise and in any case make a nice addition to most diversified portfolios. I personally own GIM and am slowly adding exchange traded bonds and preferreds.
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Re: Inversion countdown
Old 12-01-2005, 11:14 AM   #31
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Re: Inversion countdown

Quote:
Originally Posted by soupcxan
How about intermediate-term bond funds? I'm tired of watching my NAVs drop month after month.
Soup: You may just want to hang on to those things and wait for the price to go back up. Or even add some extra money now or some time in the near future. Someone here may have a bond book that they might recommend (I have an old copy of All About Bonds and Bond Mutual Funds by Esme Faerber, but there are probably better ones out there)? This is from the THE BOND GURU:

http://www.pimco.com/LeftNav/Late+Br...ember+2005.htm

Good Luck (and skill), bond knowledge is at least as important as stock knowledge--if not more so--because that's where your safe money lives .

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Re: Inversion countdown
Old 12-11-2005, 07:21 PM   #32
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Re: Inversion countdown

Brewer: I found this article interesting regarding interest rates spreads. What's your take?

http://www.bloomberg.com/apps/news?p...columnist_baum
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Re: Inversion countdown
Old 12-12-2005, 07:17 AM   #33
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Re: Inversion countdown

I largely agree. The rrecent desperatte attempts by he administration to revive its pathetic poll numbers should not be seen as anything but political chicanery.I also think that the underlying problem is that the economy as a whole and especially corporate profits appear to be OK (not great, but not bad), but the "real economy" of Joe Sixpack and the average consumer is somewhat weak. Median income is down over the past 4 years despite overall economic growth. What does that tell you? Hard to see how there can be a big economic party when a lot of recent growth has been based on increasing income and wealth stratification.
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Re: Inversion countdown
Old 12-27-2005, 09:38 AM   #34
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Re: Inversion countdown

http://money.cnn.com/2005/12/27/mark...ex.htm?cnn=yes

"...the yield on the benchmark 10-year Treasury fell below that of two-year notes for the first time since December 2000."

Looks like the inversion has finally happened!
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Re: Inversion countdown
Old 12-27-2005, 10:15 AM   #35
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Re: Inversion countdown

Bouncing around flat now. We go solidly inverted (like 10 BP for a week) and I think it is time to take this stuff seriously. Maybe time to buy some QQQQ puts...
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Re: Inversion countdown
Old 12-28-2005, 05:25 PM   #36
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Re: Inversion countdown

Turned on CNBC today, saw the inversion news and said, "I'll have to check in with brewer!" upon which my friends/family said, "who's brewer?" :P.
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Re: Inversion countdown
Old 12-28-2005, 06:44 PM   #37
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Re: Inversion countdown

Quote:
Originally Posted by Laurence
"who's brewer?"
Isn't he that guy...second cousin of Bob Marley?
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Re: Inversion countdown
Old 12-29-2005, 06:49 AM   #38
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Re: Inversion countdown

Quote:
Originally Posted by Laurence
Turned on CNBC today, saw the inversion news and said, "I'll have to check in with brewer!" upon which my friends/family said, "who's brewer?"* :P.*
Heheh, you should know better than to pay attention to CNBC! They have it on here at work all the time - drives me nuts.
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Re: Inversion countdown
Old 12-29-2005, 09:54 AM   #39
 
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Re: Inversion countdown

Quote:
This is from the THE BOND GURU:

http://www.pimco.com/LeftNav/Late+Br...ember+2005.htm
In that article, chart 1 is labelled "Expected 1 year real US yield -- nine years into the future." But the x axis is 1997 - 2005.

Was that a predition 9 years ago, was the axis mislabelled, or what??
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Re: Inversion countdown
Old 12-29-2005, 12:14 PM   #40
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Re: Inversion countdown

OK, so what % of the time that there has been an inversion did a recession occur? Any statistics or correlation on how much iversion and how big a recession?
I'm sort of a bear but I don't knwo when the adjustment is due and whether it will be a short sharp contaction or a long slow one. Any clue from looking at the inversion tea leaves?
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