A well known philanthropist (John Paul Getty) once said “If you owe the bank $100, that’s your problem. If you owe the bank $100 million, that’s the bank’s problem.”
US Treasury Note Trade
The sooner European politicians read this quote and look in the mirror, the sooner the risk on trade will be back in force. Until then, we could either see their continued failure to accept their lack of responsible lending (and monitoring of recipients), stifling any rallies, or a continuation of the ‘fix the symptoms not the disease’ solutions that may buy them time, but is unlikely to benefit anyone’s retirement funds but their own. Fortunately, 10yr US Treasury Notes are yielding below 2%, from above 3% before June, largely due to their safe haven nature rather than US fundamentals. My view is that the next 6-12 months will be the optimum time to be short US Treasuries, with any entries below 2.1% being favourable, and it’s not because I think high yields will be the result of a European recovery.
The sooner European politicians read this quote and look in the mirror, the sooner the risk on trade will be back in force. Until then, we could either see their continued failure to accept their lack of responsible lending (and monitoring of recipients), stifling any rallies, or a continuation of the ‘fix the symptoms not the disease’ solutions that may buy them time, but is unlikely to benefit anyone’s retirement funds but their own. Fortunately, 10yr US Treasury Notes are yielding below 2%, from above 3% before June, largely due to their safe haven nature rather than US fundamentals. My view is that the next 6-12 months will be the optimum time to be short US Treasuries, with any entries below 2.1% being favourable, and it’s not because I think high yields will be the result of a European recovery.
