Tag Archives: Bond yield

Australian property bubble on a scale like no other Yesterday Citi produced a new index which pinned the Australian property bubble at 16 year highs: Bubble trouble. Whether we label them bubbles, the Australian economy has experienced a series of developments that potentially could have the economy lurching from boom to bust and back. In recent years these have included:  the record run up in commodity prices and...

Australian property bubble on a scale like no other Yesterday Citi produced a new index which pinned the Australian property bubble at 16 year highs: Bubble trouble. Whether we label them bubbles, the Australian economy has experienced a series of developments that potentially could have the economy lurching from boom to bust and back. In recent years these have included:  the record run up in commodity prices and...

(Dublin business trip is ending, London next week, sporadic posts to continue) Swiss Franc Click to enlarge. FX Rates The US dollar is lower against all the major currencies this week as North American participants close it out. On the day, the dollar is consolidating swings yesterday and is narrowly mixed. Bond yields are higher and equities are mostly lower. The euro has finished lower the last three Fridays....

Summary: Notable that as the CRB Index moves lower, MSCI emerging market equities have done well. European banks are retreating after the stress test results. Tokyo elected its first women governor as this seem to be in part a sign of protest against Abe. August has begun off with clear price action.  The US dollar is stronger against nearly all the major currencies.  Bond yields are higher.  Equities and...

Jeff Gundlach is not the only person who is feeling “maximum negative” on Treasuries. In an interview, none other than the “Maestro” Alan Greenspan, the man whose “great moderation” policy made the current global bond bubble possible, said that he is worried bond prices have risen too high. Asked if he finds what is happened in the bond market right now “in any way, shape, or form concerning for financial...

For us the five major drivers of government bond yields are: Inflation expectations and inflation:  The by far most important criterion. High inflation expectations must be compensated via higher bond yields. The main driver behind inflation expectations is the wage development, this is the form of inflation that typically persists. Price inflation follows inflation expectations with a certain lag. Wealth: The higher the wealth of a country, the lower the bond yields. Wealth is typically...

For us the five major drivers of government bond yields are: Inflation expectations and inflation:  The by far most important criterion. High inflation expectations must be compensated via higher bond yields. The main driver behind inflation expectations is the wage development, this is the form of inflation that typically persists. Price inflation follows inflation expectations with a certain lag. Wealth: The higher the wealth of a country, the lower the bond yields. Wealth is typically...

Our monetary system is failing, but explaining that isn’t easy. The most popular argument is that the dollar has falling purchasing power and rising inflation. The problem with this argument is that consumer prices aren’t skyrocketing now. So, of course, people remain skeptical. Yields across all markets were falling worldwide. This causes the income generated from assets to fall. I wrote about this serious problem last time, introducing the concept of yield purchasing power—which is how...