Warning- Bond Dislocation in Progress

reply to post by Tentickles



Very poetic,apocolyptic,and oh so telling...this simple statement literally spoke volumes to me.
It really is as if we're watching "history" unfold and are galvanized/unable to even participate let along change the course of action.

I don't have a lot of financial savvy. I did realize that things were not looking good and would more then likely get worse before it got better.

I have been taught to save for a rainy day and to avoid debt if at all possible.

What does this mean for people that have fixed mortgages but no debt?

What does this mean for people that have good credit, a little debt and a fixed mortgage and for those with a ARM?

Makes me sad when I call my family to tell them this and they have no idea what I am talking about.

They asked me for layman's terms and I said: Okay, goto the bathroom, open the crappe', take a #, then reach in and throw it at the first person you see.

reply to post by Tentickles


Now that was funny.

I wouldn't dare call and tell my family. They wouldn't know what the hell I'm talking about.

I'm glad I don't own a house......What a sad day.

-Dev

Originally posted by NightSkyeB4Dawn

What does this mean for people that have fixed mortgages but no debt?

Fixed mortgage, should be ok....no debt...even better

What does this mean for people that have good credit, a little debt and a fixed mortgage and for those with a ARM?

The cost to service the debt on anything with an adjustable rate will increase.....

Originally posted by RolandBrichter

Originally posted by NightSkyeB4Dawn

What does this mean for people that have fixed mortgages but no debt?

Fixed mortgage, should be ok....no debt...even better

What does this mean for people that have good credit, a little debt and a fixed mortgage and for those with a ARM?

The cost to service the debt on anything with an adjustable rate will increase.....

Thanks for the feedback..

This fits hand in hand with a thread I posted over the weekend
Foreclosures "Third Wave"

you see In the latest phase of the nation's real-estate disaster, the locus of trouble has shifted from subprime loans — those extended to home buyers with troubled credit — to the far more numerous prime loans issued to those with decent histories. all due to the rising unemployment rates... Foreclosures up 60 % over this same time last year

Now add to that 'Helping Families Save Their Homes act' that was sent to Obama to sign was missing a key element,,,removed was the ability to let a bankruptcy judge renegotiate the terms of a defaulted mortgage... those 8 million + homeowners in trouble will not be getting help, just more lip service..


throw in your news to the mix and we might just be seeing condition's for the perfect storm...the signs are there and the all say "Going Out of Business"!
wonder how the powers the be will get us out of this one? start another war? declare marshal law? maybe they'll just start hauling stuff out on the white house lawn and have a moving sale?



[edit on 27-5-2009 by DaddyBare]

Another interesting take on the matter here...it helps to explain the bizzarro equities market lately...FYI when he refers to "QE2" think the second application of Quantitative Easing

Source

The bond market has spoken, and it demands QE2 (the equity market is insane - it has no idea what it wants). The way treasuries and mortgages are trading, the situation threatens to very quickly spiral out of Bernanke's control (and then how will Wells and BofA pretend like they have some recurring cash generating power? On the non-recurring front, AIG has already been tapped dry.) The table below indicates that based on 2009 supply (not to mention outstanding notionals) the Fed will have to reach into its toolkit for some other (very drastic) measures.

It is painfully obvious that the status quo will not suffice. So the real question is what is the Fed waiting for?Is Ben merely afraid of China's reaction to the imminent launch of QE 2-xxx - that would seem like an irrelevant issue as marginal refi/lenders are about to be priced right out of the market, at the same time as house prices are still dropping, thus destroying absolutely any incentives for (highly confident) consumers to lever themselves up.

yes this will hurt those with adjustable rates......but so many of these people stopped paying anyway.....and banks don't have the staff to keep up with all of them .......so growing numbers of people pay nada and stay in their home ......(saving up for rental payments) should they eventually get the foreclosure notice but that is not a ideal way to live

I know Genesis and the gang are getting all riled up over the rising rates but Historically speaking the Gov't debt rates were at their highest prices after a 28 year BULL MARKET.......28 years!........rates rising fast is not a good sign but historically speaking they are still very low.....so ...ya i know rising rates aren't good for the economy....or a leveraged financial sector......but nobody could have thought they would stay historically low for that long

..the more distrubing things is that for a few days now when the bond market sold off the equity markets did also........maybe smart investors realize the U.S economy's future isn't entering "recovery"! but perhaps the admin will have second thoughts about more gov't spending.......the fed could just start buying up ALOT more DEBT...

[edit on 27-5-2009 by cpdaman]

Originally posted by cpdaman
..the more distrubing things is that for a few days now when the bond market sold off the equity markets did also........maybe smart investors realize the U.S economy's future isn't entering "recovery"! but perhaps the admin will have second thoughts about more gov't spending.......the fed could just start buying up ALOT more DEBT...

[edit on 27-5-2009 by cpdaman]

Indeed, very disturbing....keep a lookout for the second round of quantitative easing...bernanke has no choice now, he's bought the farm on this one...

OP: Denninger....


"Bernanke and other policymakers, including both the Bush and Obama Administrations, have tried to deny reality.

You can't.

The Bond Market has had it with the games, and despite a "good" auction today signaled its disgust with the lies, the unending deficits and both bonds and stocks sold off at the same time...."


Well said KD...the dog wags...the tail responds.

A severe reaction from the bond market this week in response to extreme policy decisions by the Federal Reserve , and , a simultaneous "vote of no confidence" in the Keynesian fiscal odyssey embarked upon by political administrations of either stripe.

Fears of looming inflation puts pressure on the long-end - as risk averse lenders roll-out of sketchy agency debt , benchmark 10yr notes, 30yr bonds - and roll-into the relative "safety" of shorter-term securities.


Yeah , the bond market is smart alright...prescient...the curve a proven indicator.

Does the Fed tighten ? Not a chance.

Similar to a rainbow , they say that following a steepening yield curve will ultimately lead the wise man to a Pot 'o' Gold.

Lets see what happens here.....


GL


China Dumping Long-Term Bonds, Concerned About U.S. Inflation

Chinese group buys stake in US basketball team

Makes me glad we refinanced Friday. 4.6% 15 yrs. It is our only debt and is approx 1/4 of the current home appraisal. I think I did good However on the flip side most people will not be able to do this. The economy will falter. I will lose my job. I will have my new loan forclosed. Maybe things are not so good.

respectfully

reluctantpawn

reply to post by Tentickles




Ditto your first post in this thread

reply to post by irishchic



Heh heh . . . the weather got us too I like that weather though!


Heck, maybe I can pick you up on the way to Tentickles to play on the slip and slide.


___________________________________________________________

So basically, this is to money as is a plane entering jet wash and going into a flat spin?

Dont worry about this guys..

Uncle Ben is going to go on TV if anything needs to be said, smooth things over and big money will respond.

If this doesn't happen, then I will rely on Tim 2Tall Geithner ..

If this doesn't happen, I then will rely on Obama..

Lets just hope Big Ben makes us rich again, I think he will, he is afterall my uncle!

reply to post by reluctantpawn


Thats a great rate..

Im glad there are "positive" stories amid all the negativity

reply to post by RolandBrichter


I am almost done reading this most excellent book.

The Creature From Jekyll Island - A Second Look at the Federal Reserve

I find it fascinating the secrecy in which the founders went to, as well as it talks about in detail just how the Federal Reserve Bank was created on Jekyll Island, Georgia by the Jekyll Island Club and every single way in which the rich will do anything and everything, just to make a profit, including and up to sacrificing thousands of innocent civilians.

Mr. G. Edward Griffin is seen in these series of YouTube videos, speaking at length about the creation of “the creature” and with the exception that he mentions the New World Order I love the whole book.

Creature from Jekyll Island 1 of 12 :


Creature from Jekyll Island 2 of 12 :


Creature from Jekyll Island 3 of 12 :


Creature from Jekyll Island 4 of 12 :


Creature from Jekyll Island 5 of 12 :


Creature from Jekyll Island 6 of 12 :


Creature from Jekyll Island 7 of 12 :


Creature from Jekyll Island 8 of 12 :


Creature from Jekyll Island 9 of 12 :


Creature from Jekyll Island 10 of 12 :


Creature from Jekyll Island 11 of 12 :


Creature from Jekyll Island 12 of 12 :


Now, it does not specify about "bond dislocation" specifically within the book, it does go into explicit detail in how the "Bailout" which led up to our current situation right before this bond issue you're referencing happened, as an entire and complete scam on American citizens through the machinations of the bankers forcing laws through paid-off and placed people within "The Fed" as it is known.

Is also explains, that the Federal Reserve, is not "federal" except by name, and is anything but a "reserve", it is in fact a conglomeration of banks fused together to secure any real competition from happening that Rockefeller, J.P. Morgan, and Rothschild as well as the British banking consortium do not want.

The book has been reprinted eighteen times, meaning it is in high demand.


[edit on 27-5-2009 by SpartanKingLeonidas]

reply to post by SpartanKingLeonidas


My dad had me read that book when I was in high school..

I like the way the author paints the story..

But I dont know exactly if it is non biased IMO

reply to post by GreenBicMan


I can fully understand your take on this book.

The reason I like it so well, is I own over half of the books he references within his book.

This book, combined with all of these, gives me a fully rounded view on the whole topic.

In my humble opinion, you have to read all of these books, as well as the one I mentioned in the former post, to fully appreciate as well as understand the entire process that has led us to where our nation is right now.

The Medusa File: Secret Crimes and Coverups of the U. S. Government

The Game of the Foxes: The Untold Story of German Espionage in the United States and Great Britain During World War II

Wall Street & the Bolshevik Revolution

The Gulag Archipelago Volume 1: An Experiment in Literary Investigation

Wall Street & the Rise of Hitler

IBM and the Holocaust: The Strategic Alliance Between Nazi Germany and America's Most Powerful Corporation

The True Story of the Bilderberg Group

Tragedy & Hope: A History of the World in Our Time


[edit on 27-5-2009 by SpartanKingLeonidas]

reply to post by SpartanKingLeonidas


Wow, had no idea this guy wrote so many..

While I know the story is totally true, when I read it I saw it all in "black and white" I dont know how to explain it, but very dark idk..

As I have posted in other threads, I really dont waste my time trying to read too much into this stuff and rather specifically focus on the markets.. but it is an interesting story, and hats off to these guys as well. As much as you may dislike them, they are very smart individuals.

Don't worry, some report will come out with absolutely dismal numbers tomorrow that wont be a dissmal as some analyst predicted and the market will run back up a percent or two on misplaced optimism that we have hit bottom.

It will take a year or two before Geithner's, Bernake's and Obama's chickens come home to roost and the economy to collapse again.

It's all about confidence and those three are real confidence men... if you know what I mean.