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  • July 23, 2007 at 5:29 PM #9573
    SD Realtor
    Participant

    Any comments on the 10 year yield?

    Chris S any thoughts where it will go? It would be great to see it trend down to 4.6 again but I am by no means good at predicting this sucker…

    July 23, 2007 at 6:20 PM #67313
    The-Shoveler
    Participant

    Nor_LA-Temcu-SD-Guy

    At some point I would think, the Fed will have to launch a defense of the dollar,

    How ??? would they buy dollars (with what ???)

    Would the raise interest rates and crash the economy ????

    At this point they may as well raise interest rates , subprime is dead and houses are too expensive (at least in So-Cal) for the average (joe/jane) to buy at any interest rate anymore.

    July 23, 2007 at 6:20 PM #67378
    The-Shoveler
    Participant

    Nor_LA-Temcu-SD-Guy

    At some point I would think, the Fed will have to launch a defense of the dollar,

    How ??? would they buy dollars (with what ???)

    Would the raise interest rates and crash the economy ????

    At this point they may as well raise interest rates , subprime is dead and houses are too expensive (at least in So-Cal) for the average (joe/jane) to buy at any interest rate anymore.

    July 23, 2007 at 6:52 PM #67321
    blue_sky
    Participant

    The Fed is under no obligation to to protect the value of the dollar. The Fed has two mandates:

    1. Full Employment
    2. Price Stability

    The value of the currency only affects #2 negatively if the currency is falling fast enough to cause import prices to drive inflation. And since China is still quasi pegged to the dollar that’s not happening as much as you would expect.

    July 23, 2007 at 6:52 PM #67386
    blue_sky
    Participant

    The Fed is under no obligation to to protect the value of the dollar. The Fed has two mandates:

    1. Full Employment
    2. Price Stability

    The value of the currency only affects #2 negatively if the currency is falling fast enough to cause import prices to drive inflation. And since China is still quasi pegged to the dollar that’s not happening as much as you would expect.

    July 23, 2007 at 8:40 PM #67341
    davelj
    Participant

    Actually, I’d argue that the Fed has failed miserably at “price stability.” Although it has been magnificent at playing the game of “the marketing of the appearance of price stability.” Anyone who believes the government’s CPI stats with their “rental equivalents” and “substitution effects” is a nutjob. Inflation’s gotta be running at least 2 percentage points above what the govies are reporting to us. See John Williams’ Shadow Statistics for the details…

    July 23, 2007 at 8:40 PM #67406
    davelj
    Participant

    Actually, I’d argue that the Fed has failed miserably at “price stability.” Although it has been magnificent at playing the game of “the marketing of the appearance of price stability.” Anyone who believes the government’s CPI stats with their “rental equivalents” and “substitution effects” is a nutjob. Inflation’s gotta be running at least 2 percentage points above what the govies are reporting to us. See John Williams’ Shadow Statistics for the details…

    July 23, 2007 at 9:42 PM #67347
    patientrenter
    Participant

    SD_R, I am looking forward to some pros surfacing to weigh in on this.

    Chris, are you in the interest rate business? I haven’t gone through all the archives, but I would have guessed you played mostly with your own money, and across multiple asset classes, mostly equities. Maybe I’m muddling the posts.

    Patient renter in OC

    July 23, 2007 at 9:42 PM #67412
    patientrenter
    Participant

    SD_R, I am looking forward to some pros surfacing to weigh in on this.

    Chris, are you in the interest rate business? I haven’t gone through all the archives, but I would have guessed you played mostly with your own money, and across multiple asset classes, mostly equities. Maybe I’m muddling the posts.

    Patient renter in OC

    July 23, 2007 at 10:12 PM #67349
    Arraya
    Participant

    I’m no good at predicting it either. However, it is following the same pattern as last year, skyrocked above 5 Junish and came back down end of summer/fall. If last years pattern is somewhat of a predictor you may see it get close to the 4.6…

    July 23, 2007 at 10:12 PM #67414
    Arraya
    Participant

    I’m no good at predicting it either. However, it is following the same pattern as last year, skyrocked above 5 Junish and came back down end of summer/fall. If last years pattern is somewhat of a predictor you may see it get close to the 4.6…

    July 23, 2007 at 10:52 PM #67355
    HereWeGo
    Participant

    The “flight to quality” from CMO and junk bonds has increased demand for US Treasuries. Are mortgage rates decreasing in response? Is the “subprime slime” making mortgages more affordable?

    July 23, 2007 at 10:52 PM #67420
    HereWeGo
    Participant

    The “flight to quality” from CMO and junk bonds has increased demand for US Treasuries. Are mortgage rates decreasing in response? Is the “subprime slime” making mortgages more affordable?

    July 23, 2007 at 11:32 PM #67422
    SD Realtor
    Participant

    Hi Arraya that is what I am thinking. The key will be how long it stays there assuming it does get to that point.

    Yes Herewego rates have tracked treasuries and started to fall slightly.

    SD Realtor

    July 23, 2007 at 11:32 PM #67357
    SD Realtor
    Participant

    Hi Arraya that is what I am thinking. The key will be how long it stays there assuming it does get to that point.

    Yes Herewego rates have tracked treasuries and started to fall slightly.

    SD Realtor

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