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May 18, 2009

Barron’s on Treasuries

In one of the most absurd, inaccurate, and audacious articles of the week, Barron’s alleges that “Treasuries are in a bear market.” Equal parts silly and supercilious, they go on to presume that they have insight into the Treasuries top!

“Barron’s called a top in Treasuries and a bottom in the rest of the bond market in an early 2009 cover story.”

In hindsight (if persons so inanely bold dare to use it), this cover will look as ridiculous as their June 2nd cover story: Buy GM .

As chronicled here at Trade the Picture, Treasuries must go higher

. The Treasury market is the only viable entity left which the fed can manipulate to lower rates. The Fed Funds rate can’t be lowered—it’s as low as it can go.

By claiming that Treasuries have topped, Barron’s is essentially fighting the Fed. The casualties, no doubt, in this misguided confrontation are their countless readers. They continue to publish some of the worst coverage of financial markets the world has ever known.

At some point, Treasuries will top and a bear market will follow. Before they do, they are headed much, much higher. The price action in Treasury futures attests to this eventuality. Despite Barron’s reckless assertions and deceptive cover stories, Treasuries are not in a bear market.

10 Year Treasury Note

10 Year Treasury Note

Peace


Categories: US Bonds

4 Comments »

  • Do you have a projected target/time frame?

    thanks
    I

    Comment by icoa — May 18, 2009 @ 10:38 am

  • agree, too early to say uptrend has broken

    Comment by matthew herrick — May 18, 2009 @ 7:02 pm

  • Any comments to the TSY sell off today based on the Gross comments (US AAA rating on the back of the UK ratings warnings) and the Fed indicating they will not be buying as much debt?

    Comment by craig — May 21, 2009 @ 4:56 pm
  • Mr. Volatility

    Moody’s re-iterated AAA and stable rating on U.S. today after Bill Gross comments. Britain downgraded but the pound rallies against USD. There was movement out of longer dated bonds (30 yr and 10 yr) into shorter term (2 yr). Other than that, dollar weakness. Tough to call the day to day. I doubt the $VIX and the Ten Year will decouple for more than a couple or so days.

    Comment by Mr. Volatility — May 21, 2009 @ 8:26 pm

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