Loading ...May 12 – Bloomberg (Jared Dillian): “It’s now clear in hindsight that a global pandemic was one of those things that financial markets never truly considered a real threat. This raises the question of what other so-called black swans might be lurking out there? Here’s one that might happen sooner rather than later: a failed auction of government bonds by the U.S. Treasury Department. Such a notion was unthinkable just a few months ago for the world’s richest economy and one that enjoys the exorbitant privilege of controlling the world’s primary reserve currency. Sure, the chances are still negligible that the government won’t find enough buyers for all the bonds it needs to sell to finance an estimated $3.7 trillion budget deficit. But the point is that the odds, however slim, are probably no longer zero… The reason why is that the U.S. Treasury is starting to auction $3 trillion in the span of a few months. No country at any time has every attempted such an audacious borrowing plan.”
May 13 – Bloomberg (John Ainger, James Hirai and Vivien Lou Chen): “Traders around the world are forging ahead with bets on negative interest rates, even as central banks mount a vocal counteroffensive. Fed funds futures reflected bets for a negative U.S. policy rate for a fifth day… While expectations for a shift moderated slightly after Powell’s speech, traders are still prepared for a move during the first half of next year. Global investors are factoring in a long, difficult road for policy makers trying to get their virus-damaged economies back on track. U.K. traders became the latest to price in sub-zero rates this week, in what would be the first move below zero in British history. Investors in New Zealand also see the benchmark falling through zero…”
No Comments
No comments yet.
RSS feed for comments on this post.
Sorry, the comment form is closed at this time.