/biz/ - Business & Finance

>>51572378
>Something is about to break.
Yes, your ass.

>>51572378
What does this mean

Explain like i am

>>51572378
greg mannarino bros.. did we make it? (oh no, we lost all our money on silver gold and crypto oops..)

>>51572378
Nothing ever happens

>>51572435
gm is a retard, king of retail traders

>It's an /pol/tard opinion about chart he doesn't understand episode

your sister's asshole pounded by a BBC?

>>51572378
2Y at 4.13 also

>>51572483
wtf i can get 4.1% risk free apr?

>>51572432
A big spike in the 10-year means volatility in the bond market. If the bond market explodes we get financial collapse.

>>51572519
Yea, your bank is ripping you off. US Series I savings bonds are yielding 9.6%, best performing asset of the 2021-2022 period.

>>51572519
The risk is that annual inflation will continue to be 10% at least for the duration of the bond

>>51572540
Yes, everything else collapses. The only thing that will end up paying you is a US treasury bill in financial collapse. This is why they were popular during the Great Depression, they are more reliable than the banks themselves.

>>51572558
yeah but better than cash 0%

>>51572558
that's not really a risk if all other assets are tanking even harder
just stock up on shelf-stable food and tie up any big consumer commodity purchases you think you'll have to make in the next year first

>>51572558
So buy 6 month treasury bonds at 3.9% or sell your long maturity bonds early.

If you really want to "fight inflation", manufacture your own shit and produce your own power.

Grow your own food, buy a 3D printer and create filament from recycled plastic. Learn how to fix your own car, and DIY everything. You are your own employee in a inflationary (possibly hyperinflationary) period.

>>51572647
Why is the yield curve inverted then? Why is the market betting that future rates will be lower than short term rates? Is the market "wrong"?

>>51572378
3.5 is okay. 4.5 is not.

>>51572659
>just be rich to start with bro

>>51572519
>>51572595
>>51572629
I eagerly await the day the US government defaults on its debt and all you idiots thinking treasuries as "risk free money" get shafted hard. $30 trillion in debt is unsustainable with 6%+ interest rates. If you won't invest in Russian treasuries, there's no reason to invest in American treasuries either. The default is coming.

>>51572558
The biggest reason treasuries are plummeting is the strength of the dollar. Countries like Japan and EU are selling treasuries for dollars. Add on top of the Fed not buying anymore, and nobody wants to hold the bag for an illiquid asset nobody is buying.

>>51572730
>invest in Russian treasuries
Is this even an option?

>>51572779
https://www.investing.com/rates-bonds/russia-government-bonds

>>51572730
Governments with their own currency will not default on their debt you dummy

>>51572709
>Hey bro, I know you can't afford a van to live in, but just buy 20 acres and start your own homestead.
>Oh, you can't? Shouldn't have bought all that avocado toast in the womb.

>>51572859
Yeah, so instead they just turn on the printing machine and cause hyperinflation Wiemar Republic 2.0.

Sure as hell might as well be a default in that case.

>>51572859
The currency is a private property which is why the us government pays interest to the fed for each bill they get

>>51572378
We tried to warn you.

>>51572540
What does it mean for the bond market to "explode?" And how does this "explosion" lead to financial collapse?

>>51572709
Solar panels, inverters and other equipment cost around $12,000 (so a DIY solar project is within the realm of doing yourself). I'm sure that was a better investment in 2020 than paying your power bill in Europe. An e-bike costs around $4000 or so. Rain barrels are incredibly cheap.

3D printers and other equipment costs a few thousand dollars. There are people with 6 figures here complaining about inflation when all they need to do is make their own stuff.

One, nothing wrong with me

>>51572891
Yes.

>>51572519
Not for long, lol

>>51572891
Regardless it's still better to be in bonds than in cash if that happens. Since other assets are crashing it's the lease bad place to put your money. Welcome to stagflation.

>>51572929
>What does it mean for the bond market to "explode?
Nobody wants to buy U.S. treasuries at any price.
>And how does this "explosion" lead to financial collapse?
U.S. Treasuries are the lifeblood of the world economy. When you widthdraw your cash from the bank, or buy something on Amazon, that cash isn't sitting in the bank. Your bank uses treasuries as collatoral for an short term loan of cash which it gives to you. When Japan wants to buy anything in dollars, oil for instance, it sells treasuries which it holds in reserve for dollars. The 10-year is the benchmark for all other bonds, including corporate bonds, MBSs, etc. If yields skyrocket, corporations won't be able to pay the interest on their bonds. Corporations do literally everything on credit, so they would collapse overnight. I could go on about the importants of treasuries, but you get the idea.

>>51572929
I would also like to know. 99% of the people who talk about this on /biz/ seem to have a vague sense of "number go up, curve go inside out, bad thing happen" but their actual level of understanding is cargo cult-tier.
Not that I have any fucking idea either. Bond yield go up when demand drops. Fed hits target funds rates by buying and selling bonds to add/remove liquidity from commercial banks. How it all comes together is beyond me.

>>51573126
>Your bank uses treasuries as collatoral for an short term loan of cash which it gives to you
who loans the cash? Do you know of any good resources to learn about the bond market?
Thank you for the post btw.

>>51573126
No company will even notice at all Because interest rate rose 0.2%
An entire country, yes a little but not even apple or goggle would notice that I their bottom lines

>>51573179
https://en.wikipedia.org/wiki/Repurchase_agreement?wprov=sfla1

>>51572951
>Rain barrels are incredibly cheap.

You can also get cheap portable water filters (lifestraw, katadyn, sawyer, etc.) and an attachable bag (CNOC) that makes virtually any river or lake water drinkable, even mud water. They filter basically everything except stuff like hydrocarbons, saltwater, chlorine.

They're godlike for when shit hits the fan. You can go deep inna woods with guaranteed drinkable water

>>51573144
Checked and you got it right enough. Maybe think of QE / QT as adding / subtracting liquidity from the bond market (instead of banks). In QE there is always a bid in the treasury auctions due to Fed demand. In QT there is the opposite. Fed is dumping bonds to the market. At the same time the Treasury needs to issue new bond securities to balance deficit spending so they can send more $billions to our Congress members' children in Ukraine. Combine that with inflation making treasury securities shitty investments.

Essentially right now there is huge supply of bonds with very little demand. Great Reset Shemitah year extravaganza.

>>51573343
So how can I profit off this

>>51573343
So during QE the fed is both buying and selling (issuing) bonds?

>>51573375
No. The US Treasury (government institution) issues treasury securities - bills notes bonds and more. They issue them at auctions where anyone who wants to buy puts in bids which determines the yield %.

In QE the Fed (private institution) buys treasury securities with money that didn't exist before. That's why it's called money printing. This keeps the treasury market liquid.

>>51573372
Shit man, I really don't know. This is kind of the end of the financial system if it happens. What comes next I have no idea. I guess go back to basics
>food security
>community
>survival skills
>weapons and ammo

>>51573551
it's called gold and silver

>The US federal government has to now pay 4% interest on its loans that previously were 0.0001% interest

>The US federal government has a 124% debt to GDP ratio

>>51573602
A US debt default...
That would be a Soviet Union collapse -tier event.

>>51573193
>tiny rate increases
>DJIA crashes hard
>no one, particularly tech, will notice
I HATE THE CODE KEKS! I HATE THE CODE KEKS! I HATE THE CODE KEKS!

>>51573193
The code nigger purge cannot come soon enough

>>51573193
Nobody thinks corporations will go under from a 1 day move in the bond market. 16 basis point moves in the 10-year yield are indicative of a broken bond market. There is a liquidity crisis brewing in bonds which threatens to upend the entire financial system.

>>51572929
He is referring to the possibility that everyone dumps their US treasury bonds. The price would implode (go down). (Confusing mixup of the words implode/explode but I get what he means because it's obvious for someone a little knowledgeable). If that actually happened, that really would lead to an economic collapse. The bond market is a lot bigger than the stock market. I don't think this will happen though. The dollar is strong af now which would make such a situation unlikely. Governments are selling treasuries to raise the strength of their own currencies which are declining now. Normally they wouldn't care about this but currently, weak currencies direction cause a rise in energy purchases cost which are sky high for Europe and Japan both of which import most of their energy.

>>51574323
>The dollar is strong af now which would make such a situation unlikely
That makes the situation worse. Countries like Japan and Germany are dumping U.S. treasuries because their currencies are plummeting against the dollar.

>>51572540
Cool it with the antisemitism

>>51574077
holy shit the way you niggers seethe over software engineers really shows your jealousy kek meanwhile you fell for muh heckin cozy neet demoralization psyop

>>51573126
Why does everyone hold treasuries in reserve for USD instead of holding USD?

>>51572629

That's the thing tho, assets are tanking because investors are only pricing in like 3-4% long term inflation. If the market actually priced in 8% sustained inflation, and the fed is going to 4.6%, then non-dollar denominated assets like stocks, bitcoin, and gold would moon. But right now, contrary to what people think, the market is still not pricing in inflation, its like everyone is thinking a big drop off in inflation is coming and those 3% yields are juicy because inflation will go back to 0% any day now.

>>51574674
Several reasons, but one big reason is if they held USD, it would create a scarcity of USD and weaken their currency against the dollar.

>>51574680
That doesn't mean something like chainlink couldn't swoop in and capture some market value. We're in unchartered territory.

>>51572555
Yea but if you buy in now you're kinda fucked cause you can only put 10k a year or 15k if you put 5k from taxes. I don't know what anon mentioned them but I bought in 10k in 21 and 22. Both are at 9.6% and will probably be 10% in November. I look at it like this, if the US can't pay me back for its bond that little bit of money is the least of my worries.

>>51572859
>will not
It is a choice, and some politicians may chose to declare bankruptcy rather than inflate away under specific circumstances.

If inflation is really high, i could see the AOC types would prefer defaulting rather than passing the "bankruptcy bill" unto the little man through inflation.

>>51574680
>Don't fight the FED!
>Go into cash now!
>It's no longer optional, you have to!
The second you do you get hyperinflation.

>>51573126
>>51574812
Okay so when you deposit money in the bank, the bank buys treasuries with it? Which means.. the government is actually holding everyone's deposits?

>>51575648

>>51574010
Yes, almost like it would cause a "Great Reset".

>>51574010

US would never straight up default, except maybe temporarily as part of some debt ceiling political stunt. The US can just print as many dollars as it needs to pay interest, so there will never a point in time where it defaults, but you'd just have out of control inflation. US could implement capital controls like Russia, or go the route of Turkey and just have like 80% inflation with 12% interest rates. They would probably rig CPI someway to measure inflation as 20% and market it as not that bad / could be worse. I think a lot of normies would continue to use the dollar at that point assuming other fiat currencies are still worse, instead of switching to gold or bitcoin base they are "risky". Not long term but it wouldn't necessarily be a swift collapse.

DUH!

>>51576292
Pretty solid take and I think you're right. If I put my schizo hat on I could see a publicized, theatrical debt default being used as a shock-and-awe black swan tactic to completely demoralize the goyim and cause massive panic in line with what this guy's saying >>51576097

>>51575701
More or less. The banks transact with each other, but the Federal Reserve is the banks' bank.

>>51572378
this is the most obvious bottom of all time. the 2 year and 10 year won't stay up here for long.

(unless there is a full blown market crash because there's something wrong with treasury market)

>>51572893
THIS

>>51574918
Using LLCs or other companies you can buy many as you have companies. Starting an LLC is cheap. I have over 100k in ibonds.

>>51572779
No, it's a bond

>>51576722
>unless there is a full blown market crash because there's something wrong with treasury market
Bingo. Liquidity is already an issue, and it's only getting worse with with QT, rising rates, the strong dollar, and countries dumping U.S. treasuries. We're in the biggest debt bubble in human history and this is the perfect storm for it to go pop.

>>51572558
because equities are outpacing inflation

>>51576984
>Puts on TSLA???
So like when will they save us? or is this the end of the world?

>>51572378
The MMRI must be on high alert

>>51576841
based and loophole pilled

>>51577471
The problem is this time, unlike 2008, if the Fed injects liquidity on top of raging inflation, we will get hyperinflation. They will most likely choose hyperinflation over having a stone age barter economy, but either way we all suffer.

Zoom out, dumbasses.

>>51577543
Yeah, well the FED is insistent that they are NOT going to save us this time, and would rather enter a harsh recession, than enter a long term inflation / hyperinflation scenario....

So I am assuming they are telling us the truth? and we're more likely going into a significant depression, as opposed to hyperinflation?

>>51577596
Yeah, it's the highest it's been in a decade...
Total debt was ~890 billon in 1980
Total debt today is 30 trillion...

>debt to GDP is fucked
>aging population of boomers
It's over...

>>51577644
I was talking about the daily change, what you mongrels are so afraid of. It's not that extreme, means nothing. Check June on the chart.

>>51577721
>not that extreme...
>highest since 2008
>debt up nearly 20 TRILLION since 2008

The issue is, it is extreme when the government has 30+ trillion in debt.

The FED announced they want to kill the market

>>51577611
A recession is one thing, even a depression can be tolerated, what the Fed won't let happen is another 2008 financial crisis. Few people understand how serious the situation was when credit markets froze. If the Fed hadn't acted, we were literally a day or two away from the economy just not existing. No transactions at all except local barter.

>>51577871
They have no choice retard. The only way they could possibly avoid that is by printing more money than QE1-QE4 COMBINED.

So now, they can choose between 2008 on steroids, Weimar 2.0, or both at once. Those are the 3 choices.

It's fucking OVER

>>51578083
I fail to see how a country with the most powerful military on earth can default/get fucked.

You guys seems to forget, human societies and the world have always been controlled by the greatest force.

The US is trying to trigger WW3, they're pushing leaders on the edge. That's their only way out of this. WW, then they come out as winner , CBCD and erase debt. Anyone in the way gets obliterated.

>>51578238
LONG RTX!!!! I LOVE WAR
>Putin is dead, and the USA is using a robot to replace Putin and encourage a 3rd World War...

>>51578269
Have you seen the US lately, fueling conflicts everywhere? It's so obvious, at the first misttep by someone they'll jump in "for world peace".

It sounds like game when you watch the MSM but it's nothing funny. They robbed the US citizens of their money and now they'll probably get us all killed just so they can start doing it again

>>51574010
You do realize quite obviously the new interest rates doesn't apply to old debt right?

>>51578083
That's exactly what I said here>>51577543
Work on your reading comprehension before you call others retards.

>>51578238
A liquidity crisis isn't other countries not paying us. It's our own banks not lending to each other. If that happens you won't be able to withdraw money or transact, your employer won't be able to pay you, the entire economy grinds to a hault.

Can someone explain, why are so many people fearful about the us govt being unable to service their debt due to the high interest rate but the fed never brings this concern up? They must have some sort of idea of the point at which the interest rate would be too high for the national debt.

Guys my water just broke

>>51577543
Apparently governments ALWAYS chose hyperinflation when giving the options of that vs a direct default.

>>51572378
ONE
NOTHING WRONG WITH ME

>>51578238
Retard post of the day. How will you pay for the military if the banks and currency collapse dumbass?

>>51578238
>I fail to see how a country with the most powerful military on earth can default/get fucked.

What the fuck does the military have to do with anything? You gonna invade Gyna and Russia to steal their gold?

>>51572432
The 10 year prices all assets against it. It's the risk free rate. The downturn this year is directly caused by this bond going up in yield.

>>51578378
You do realise that they constantly have to roll-over old debt into new right?

>>51578727
Is the boomer 80% Equity / 20% Bond split dead now then?

They're supposed to be inversely correlated, but now both selling off at the same time.

So.... rates go brrre or rates go down?

Need to know... about to chain myself for 5 years to a fixed at stupid high rate.

>>51572378
yes, Canada

>>51578776
Yes, bonds are being sold off due to inflation being high. No reason to loan someone money for 10 year if inflations at 9%. The real return is negative. So yields are going up. This is bad because elevated PEs will come down and risk assets are going to get reprice downwards. Luckily it stop around here and be done. We have to just wait and see.

>>51577471
Loaded w Tesla puts. Feels good bros
>been shilling all week
>TSLA to 230 by mid Oct minimum

>>51578723
> You gonna invade Gyna and Russia to steal their gold?

That’s a bit of a simplification, but essentially yes. If China and Russia are at war with the US then all the debt, property etc held by them in the US is null and void. That would help out a liquidity problem tremendously.

>>51578843
>Luckily it stop around here and be done.
ESL retard detected. It isn't "stopping around here" nor it "be done" any time soon.

>>51578885
Probably why they are dumping treasuries and buying gold.

>>51578734
Piecemeal. The vast majority of US debt won't see these new rates.

i just see a line go up
no idea what it means

>>51578911
I'm not esl just typing with auto correct. You don't know anything about bonds so thanks for your Brainlet comment

>>51572730
>$30 trillion in debt is unsustainable with 6%+ interest rates.
So here's the thing anon. We can just like, lower rates and the value of the dollar.

Looks like the line is going up. Why don't people just sell their bonds and profit

>>51578831
Why?

>>51574680
This is what I’m thinking too. Slurpers keep slurping thinking it’s going to go back up, also making it go back up, instead of letting it drop as intended. How many times does Jpow have to warn these niggers?

>>51576841
That's fucking awesome. I have an LLC as well. Gonna set that up tonight. Thanks anon.

>>51579042

>>51572378
relax...
zoom out a little

>>51576875

Can someone explain this to me in Family Guy terms?

>>51579434
It's not the value of the yield, it's the rate at which they're spiking. There's unprecendented volatility in the bond market which is spiraling into a full on liquidity crisis in the financial system.

>>51576875

so fellas does this mean buy treasury bill is bad?

>>51576841
Can you buy ibonds as a foreigner?

>>51579030
How are you so dumb? If we could keep rates low why didn't we just keep them low to begin with?

We raised them and have to keep them raised because inflation is a becoming more entrenched. We can lower them sure, then inflation doesn't go away and people riot when they can't afford to live.

See Zimbabwe for an example.

>>51578626
Only politically expedient approach is to let the economy go down the shitter and for citizens to really feel the heat and then turn the printers on under the guise of trying to help them. Hyperinflation ensues, and the currency quickly needs to be replaced. Who knows, that replacement might be CBDCs

>>51580821
>he believes the news

Can someone explain to me why 30 year treasury bond rate is lower than the 2 year treasury notes and treasury bills? Wouldn't the rate be higher for a treasury bond you hold on to for 30 years vs a treasury note you only hold onto for 2?

>>51578083
>ibond master race
i welcome it

>>51572378
Sorry boboid but this is priced in

>>51580990
Short term rates are more influenced by the FFR set by the fed and how people think it will respond to economic conditions.
Long term rates 10+ are much more influenced by inflation expectations.

So when when short/long yields invert as you've described, it means people are expecting fed to set rates higher for now, but that rate will be forced lower as inflation moderates over the long term. In other words, people still have confidence that inflation is not in a runaway weimar type situation where we'll be sitting at 9%+ for the next decade.

>>51580772
no, sorry bro.

>>51579641
Shut the fuck up, Greg.

>>51576463
why the fuck is this a reply to two different posts
my brain hurts
>>51576292
>>51576097

>>51581113
Thank you

>>51581250
Greg warned all of you and now the MMRI is on red alert. Exit all markets

>>51581341

>>51574674
>Why does everyone hold treasuries in reserve for USD

Treasuries have yield which offsets inflation

>>51574829
>That doesn't mean something like chainlink couldn't swoop in and capture some market value

LINK tokens are so far removed from the bond market that your comment gave me a headache.

The value of the LINK tokens are dependant on whether the LINK blockchain does oracle systems better than ORACLE Corp. does.

>10y @ 5%
>2y @ 6%; 100bps negative spread
>DXY 120
>EUR .85 / GBP at parity
>S&P 3000
>BTC 8000; ETH 500
>"Growth Recession"

>>51572740
YIELD CURVE CONTROL
I
E
L
D
C
U
R
V
E
C
O
N
T
R
O
L

>>51574965
>some politicians may chose to declare bankruptcy rather than inflate away under specific circumstances

The trouble is that there is no bankruptcy court for nation-states. The "bankruptcy court" for nation states is how their creditors react; ask Germany how that goes.

The alternative to inflating (((monetizing))) the debt is to abruptly cut large swaths of government.

How that would go in a county as large as ours is yet to be seen. Democracies don't cut public sectors very smoothly.

>>51581374
Does that guy have implants?

>>51577871
>If the Fed hadn't acted, we were literally a day or two away from the economy just not existing. No transactions at all except local barter.

Lies

Imagine thinking any of the numbers on the charts mean anything.

The age of fundamentals died after 2008.

The only people going broke if shit fucks up are over leveraged morons.

>>51578556
>Why does the Fed never mention insolvency concerns?
I guess because they want to maintain the illusion of being independent from the government, and not being involved in fiscal policy. The official line is that it's up to Congress to not spend so much that they can't pay it back, and its not the Fed's problem if they do.

>>51578626
>ALWAYS choose hyperinflation.
Not quite always. Almost, but not quite.

>>51578626
>options of that vs a direct default

No government will do a "direct default" because it isn't precisely possible without a "government shutdown."

The bonds would be paid by a military issued currency just like in pre-nazi Germany if that happened.

>>51580735
A good candidate for training in the dungeon

>>51582985
okay I'll bite what's the one example?

>>51572730
Privet, Ivan

>>51582021
no, i think anon's right
Chainlink will usher in the Great Reset