Shorting the US government
Social Security reached its tipping point and is in the red, socialized healthcare has been enacted, there are long-term inflationary pressures, and the deficit is huge. Any ideas for shorting the U.S. government? - US Treasuries, stips, etc. - Companies that service the government (any specific ones?)
Well, there is a market, however scary this sounds, for US CDSs. However, I doubt any individual can buy them. Anyway, when you think about it what bank is going to be able to make good on the trade should it happen? If it was to happen the only thing worth anything would be gold and your Remington shotgun - which I highly advise you to purchase if you think buying US CDS is worth it. I mean, really, who the hell can sell that paper and make good on it? Believe it or not though there is a market for it.
Other than that, stick with TBT which is an ETF that is short the long end of the UST curve (20+ 'till maturity)
Definitely buy a lot of different types of firearms, and ammo.
And TBT is great... if you want a little more leverage, try TMV, the 3x short 30 year treasury.
Shorting the treasury for next week would be a pretty stupid move...
What inflationary pressures are out there? If anything there are significant deflationary pressures.
What significant deflationary pressure? Where are you getting this impression from? The market is getting flooded with $600 billion, we are introducing mild inflation into the economy. I just highly doubt there is deflation. Have you seen the prices out there? It's only going up.
Are you kidding? Shorting the US Government? Only Nostradamus could make such a bet. The US talks about printing $600 billion and a week later the dollar is on it's way up. Do you understand the power of the US? you have to be Russian or Cuban to even think of a bet like that going your way. Philosophers can't even grasp the power of the US government.
The only prices that are going up are volatile commodity prices. Overall wages have been staying flat and with unemployment near 10% the economy is not exactly growing at breakneck speed. Look at the yields on US Treasurys they are all near some of the lowest levels ever. How does that equal rampant inflation?
I never claimed rampant inflation. You inserted that. But you claimed significant deflation. I would like you to prove that. And like you said if commodity prices are moving up...that is the leading indicator that inflation is to flow. Although that is unlikely at current situation to cause for a fear in inflation or rapid rise in inflation. However, no signs of significant deflation like you mentioned. We are injecting $600 billion into the market that should only created a mild inflation. Which can in turn kick long term yields higher if expectations that QE2 is was not necessary and the economy is recovering. Please prove your statement on deflation.
All of the data coming out in terms of house hold and personal income shows wage levels are remaining flat. I don't think there will be deep deflation but if you look at the CPI and other indicators of inflation you will see that they have remained at 1% for sometime now. In response to commodity prices increasing I don't recall too much talk about "shorting the US government" due to inflation when oil was at $155 a barrel and prices across the board were increasing. Where were the calls that the government must do something about inflation back then? People have been claiming inflation is just around the corner ever since TARP and other programs have bloated the Feds balance sheet. They have been wrong. We are in a deflationary economy in which wages and prices have held flat.
Can't you just buy US CDS denominated in another currency or something? I'm going to Edward Jones right now to talk to my broker. What goes up must come down.
Good luck trying to fight the fed.
Hold off there MP80. I didn't claim on high inflation there nor about shorting. I am not the OP who had the idea of shorting US Government, so don't attack me there. I just wanted to see where you are getting the view of deflation.
As to housing remaining flat...yes, but doesn't signify we going into deflation. As to CPI...that index basket is just outdated...let's strip out everything, the food prices and commodities are still increasing. The only thing that dragged it down is utility energy gas -2.7% for sept. But gas prices keeps falling as there is endless supply of gas right now. So it looks like we are still growing slowly, but no risk of deflation yet.
The debt commission just came out with its suggestions for fiscal solutions, and it sounds like a pretty gutsy move.
IMHO, the US government is going to be a bad short IF we carry out the fiscal reforms. We will have several difficult years ahead, but if we go through with their plan, we'll be in good shape.
//www.wallstreetoasis.com/blog/budget-commission-introduces-bold-plan-to-…
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