Bonds

• IG Index Daily Market Update 18/07/08-

  IG Index Daily Market Update 18/07/08

• IG Index Daily Market Update 17/07/08-

  IG Index Daily Market Update 17/07/08

• IG Index Daily Market Update 16/07/08-

  IG Index Daily Market Update 16/07/08

• IG Index Daily Market Update 15/07/08-

  IG Index Daily Market Update 15/07/08

• IG Index Daily Market Update 14/07/08-

  IG Index Daily Market Update 10/07/08

• IG Index Daily Market Update 10/07/08-

  IG Index Daily Market Update 10/07/08

• IG Index Daily Market Update 08/07/08-

  IG Index Daily Market Update 08/07/08

• IG Index Daily Market Update 07/07/08-

  IG Index Daily Market Update 07/07/08

• IG Index Daily Market Update 04/07/08-

  IG Index Daily Market Update 04/07/08

• IG Index Daily Market Update 03/07/08-

  IG Index Daily Market Update 03/07/08

• Government Bonds: Not So Vigilant-

  I have been bearish on government bonds since March this year and have repeatedly warned that they were an overpriced asset class, saying at the time: “… one should be cognizant of the fact that an investment in a 10-year Treasury Note will by definition lock in a total return of 3.5% over the next 10 years. This sounds unsustainable and I find it difficult to see the long-term investment merit of such an investment. Long-dated bond prices could be hit hard once yields adjust to more realistic levels.” (See “Long Bonds in Injury Time”, March 28, 2008.)

• IG Index Daily Market Update 02/07/2008-

  IG Index Daily Market Update 02/07/2008

• IG Index Daily Market Update 01/07/2008-

  IG Index Daily Market Update 01/07/2008

• IG Index Daily Market Update 27/06/08-

  IG Index Daily Market Update 27/06/08

• IG Index Daily Market Update 26/06/08-

  IG Index Daily Market Update 26/06/08

• IG Index Daily Market Update 25/06/08-

  IG Index Daily Market Update 25/06/08

• IG Index Daily Market Update 24/06/08-

  IG Index Daily Market Update 24/06/08

• Market call 23 giugno 2008-

  Cfd, commento al mercato, mercati finanziari,derivati, IG Markets,

• IG Markets Marktupdate-

  IG Markets Marktupdate 23/06/08

• IG Index Daily Market Update 23/06/08-

  IG Index Daily Market Update 23/06/08

• IG Index Daily Market Update 20/06/08-

  IG Index Daily Market Update 20/06/08

• IG Index Daily Market Update 19/06/08-

  IG Index Daily Market Update 19/06/08

• IG Index Daily Market Update 17/06/08-

  IG Index Daily Market Update 17/06/08

• IG Index Daily Market Update 18/06/08-

  IG Index Daily Market Update 18/06/08

• IG Index Daily Market Update 17/06/08-

  IG Index Daily Market Update 17/06/08

• IG Markets Marktupdate-

  IG Markets Marktupdate 16/06/2008

• weekly market call 16/06/2008-

  Commento ai mercati del lunedi' mattina.

• IG Index Daily Market Update 16/06/08-

  IG Index Daily Market Update 16/06/08

• IG Markets Marktupdate-

  IG Markets Marktupdate 16/06/2008

• IG Index Daily Market Update 12/06/08-

  IG Index Daily Market Update 12/06/08

• IG Index Daily Market Update 13/06/08-

  IG Index Daily Market Update 13/06/08

• IG Index Daily Market Update 09/06/08-

  IG Index Daily Market Update 09/06/08

• CFD News 09/06/2008-

  Commento ai mercati 09/06/2008

• IG Index Daily Market Update 10/06/08-

  IG Index Daily Market Update 10/06/08

• IG Index Daily Market Update 11/06/08-

  IG Index Daily Market Update 11/06/08

• IG Index Daily Market Update 04/06/08-

  IG Index Daily Market Update 04/06/08

• IG Index Daily Market Update 05/06/08-

  IG Index Daily Market Update 05/06/08

• IG Index Daily Market Update 06/06/08-

  IG Index Daily Market Update 06/06/08

• CFD News 02/06/08-

  Commento ai mercati 02/06/2008

• IG Index Daily Market Update 02/06/08-

  IG Index Daily Market Update 02/06/08

• IG Index Daily Market Update 03/06/08-

  IG Index Daily Market Update 03/06/08

• IG Index Daily Market Update 30/05/08-

  IG Index Daily Market Update 30/05/08

• CFD News 27/05/2008-

  Commento ai mercati 27/05/2008

• IG Index Daily Market Update 29/05/08-

  IG Index Daily Market Update 29/05/08

• Warren Buffett on Long Term Capital Management
• Emergency Fed Rate Cut (75bp) - And Why Resistance is Futile-

  Last night, the futures market showed the US markets dropping over 500 points on fears of an emerging recession in the US. While I was hiding in fear at the doctor’s office, Bernanke and the FOMC held an emergency meeting and cut interest rates by 75 bp, bringing both the Fed Funds Rate and the Discount Rate to 3.5% and 4%, respectively.

• Picture du Jour: US Long Bonds in Injury Time-

  Since the advent of the credit crisis, stock markets, real estate and the US dollar have been the subject of investors’ angst. However, two markets – commodities and long bonds – have remained in bullish trends. That, at least, is the way it looked until recently.

  The Reuters/Jeffries CRB Index hit a peak on March 13, and I argued in a subsequent post that although a correction was overdue, the long-term trend was still upwards.

  But what about the outlook for US bonds, especially as yields have edged up since the recent lows of 3.314% (March 17) and 4.165% (March 20) for the 10-year and 30-year Treasury Note respectively?

• Portfolio Risk Reduced With Combination Of Bonds And Stocks-
  A combination of stocks and bonds in ones investment portfolio can reduce the overall risk or volatility of investment results. It should be noted though that the bond component of the portfolio will reduce the overall return of ones investments in the long run. On the other hand the bond allocation has been shown to reduce the magnitude of negative returns in down equity markets.
  
  A recent article in the American Association of Individual Investors summarizes returns given various portfolio allocations. The article notes several lessons to be learned from the behavior of the portfolios over different market cycles.
  

  Lesson One: Mixing bonds and stocks moderates portfolio risk.

• Credit Recession Drives 10 Year Yields Down to Previous Outlier Lows- As noted in earlier reports, when an outlier event has occurred in the past ten years causing investors to seek the safe haven status of treasuries, the first thing the 10 year does is trade down to 4.10%. We have recently reached 4.13% as of last week. This is what happened during the LTCM crisis (totaling about a $4Billion bailout if memory serves) and the September 11 terrorist attack on the WTC.
  
• Taking The Mystery Out of Fed Forecast-

  The Federal Reserve announced plans to take the secrecy out of their policy-making, explaining they will take the effort to disclose more information concerning economic forecasts. Details regarding growth and inflation objectives will also be less mysterious. Supreme Court Hears Oral Arguments in Kentucky v. Davis Municipal Bond Case-

  The Supreme Court heard oral arguments today in the Commonwealth of Kentucky vs. Davis municipal bond case today. Media reports indicate the justices are leaning towards not disrupting a state's right to tax out of state municipal bond interest. According to The Wall Street Journal:
• Prime interest rates and the market value of Gold- Before the Feds Emergency rate cut on Friday the bias was to higher rates across the board. For example the Australian Reserve Bank increased prime interest rates by 0.25% and even now after the stock market pummeling, continues to warn of more to come. This article explains why interest rates are about to go higher at exactly the WORST possible time.
  
  The question foremost on investors minds is whether a turbulent stock market warrants halting interest rate increases or, in the case of the US, decreasing rates to resuscitate the Real Estate and credit markets.
  
• An Unholy Alliance Between Commodities And Bonds- The strong positive correlation between Bonds and Commodities is creating an unholy alliance and confusing investors.
  
  Strange how markets work!
  
  Just when we thought we had it all figured out, just when we became convinced that inflation would win the day, those damn Treasury Bills just refused to confirm our hypothesis.
  
  There is a somewhat strange and almost unholy alliance developing between Bonds and Commodities.
  
• Consider Bonds in Addition to ETFs-

  Bonds are another essential tool for any investor's toolbox. Roger Nusbaum for Random Roger's Big Picture offers some tips on how to watch the bond market: