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Re: The_Net post# 1210

Sunday, 05/22/2011 12:16:26 PM

Sunday, May 22, 2011 12:16:26 PM

Post# of 1298
Sorry for the delay. I have been working on a new trading thing. I'll explain later, but if you haven't already gotten a response, basically if stocks go down, that money piles into bonds. Bond prices going up means the rates go down. But in this case, the expectation is that that money is not going to be put at risk with inflation around 3%+ now and getting paid only 3.2 on 10 years. So, the lack of demand once the Fed is gone for those bonds will make them fall in price, thus pushing up rates and TMV. That was the idea. I think it still plays out, but maybe not as fast as you'd expect.

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