• 619 days Will The ECB Continue To Hike Rates?
  • 619 days Forbes: Aramco Remains Largest Company In The Middle East
  • 621 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,021 days Could Crypto Overtake Traditional Investment?
  • 1,026 days Americans Still Quitting Jobs At Record Pace
  • 1,028 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,031 days Is The Dollar Too Strong?
  • 1,031 days Big Tech Disappoints Investors on Earnings Calls
  • 1,032 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,034 days China Is Quietly Trying To Distance Itself From Russia
  • 1,034 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,038 days Crypto Investors Won Big In 2021
  • 1,038 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,039 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,041 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,042 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,045 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,046 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,046 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,048 days Are NFTs About To Take Over Gaming?
Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

  1. Home
  2. Markets
  3. Other

Interest Rates Spike Again

This morning's employment report looked good enough on the surface to rekindle talk of an end to the Fed's debt monetization program. So in addition to buying stocks at the open, traders began their day by dumping bonds. The 10-year Treasury yield is up by over 8% in early trading, to almost 2.7%.

10 year treasury july 2013

Now the question is, which of these two opposing forces -- rising employment and rising interest rates -- predominates. Specifically, are rising interest rates a sign of systemic health or an arrow aimed at the heart of an overleveraged society? A few things to look for: recalculations of the deficit in light of spiking interest costs, comparisons of US and Japanese yields and speculation about what this means for Japanese rates -- followed by dire analyses of Japan's future borrowing costs -- and last but not least, a growing concern for the hundreds of trillions of dollars of interest rate derivatives that now have one counterparty deeply in the red.

In fact, as of 10:20 EST some of the above might already be filtering into stock prices:

DJIA July 5 2013

 

Back to homepage

Leave a comment

Leave a comment