[quote=afx114]Couldn’t this be a function of the stock market’s increase since mid-March?

Stocks up = bonds down
Stocks down = bonds up[/quote]

It’s not quite that simple and I can’t quite wrap my head around the whole process, but here it goes. You have foreign and internal purchasers of treasuries. Traditionally, they have been considered the safest place to park you money in times of uncertainty. Last fall when stocks tanked there was a huge internal flight to safety where domestic money flowed into treasuries. Concurrently, foreign purchasers have been decreasing there purchases. I actually ready somewhere that we used to have 16 and it is not down to 6 foreign buyers. So, basically domestic demand made up for foreign. Now that the domestic buyers are more risk tolerant they are going back into equities. The problem is foreign buyers are still decreasing there holdings including China which is our biggest holder. This is happening when we have a huge budget deficit because of the stimulus and other increased spending which means we need to sell more to keep the party going.