Theories on what will happen when Treasury yields go negative?
When, not if. Any theories? European bonds going negative is a very different thing from Treasuries doing the same. Any thoughts on what this will do?
When, not if. Any theories? European bonds going negative is a very different thing from Treasuries doing the same. Any thoughts on what this will do?
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I don’t share your certainty, but that’s another conversation. I’m also not smart enough on the plumbing, but this is an active conversation right now amongst STIR traders as ZIRP is getting close to priced across many markets. Questions of what happens to collateralized funding, IOR, the works. Curious to see if anyone more experienced in money markets on here will weigh in. JPM put out a 159-page piece in January titled “What if US yields go to zero?” in case you’re interested
No shit it’s not certain. I actually think bonds are incredibly risky right now. A 1% 30 year tells the fed to not worry about inflation and gives them an incentive to boost inflation.
Fed can do crazy things now. Print a trillion in currency and give $3k to every American? Yep they can do that.
Ioer should be abolished. It’s incredibly contractionary policy and prevented the cycle of reserve shedding by banks which is incredibly inflationary
The Fed will do more QE rather than push yields negative
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