Thursday, March 25, 2010

Treasuries Get Hammered Again Today!

Treasuries Get Hammered Again Today - the iShares Lehman 20+ Year Treasury (TLT) Hits New 52 Week Low!

Just like yesterday's 5 year note auction, today's 7 year note auction was weak.

Even the dumbest equity investor has to realize that this is NOT good for equities.


blogger said...

It's not so obvious to me why this means anything bad for the stock market.

TLT was already around 88.70 level back in June 2009 and also in January 2010, and that did not stop the stock market rally.

CP said...

The survival of the federal government depends on its ability to sell Treasuries at attractive prices.

Any ugly developments in the T market will force them to choose between selling Ts and propping up the housing and equity markets (which is the current policy).

I believe the market will force them to choose and I believe they will choose selling Ts - and sacrificing the equity market.