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Rates went up because of the release of the inflation data. It wasn’t anything to do with what you are mentioning. Also, while the dynamic you describe is real
by HFguy 5y ago
Rates went up because of the release of the inflation data. It wasn’t anything to do with what you are mentioning.
Also, while the dynamic you describe is real (1) the mechanics are not similar to an equity short squeeze , not a good analogy and (2) unlikely this type of pressure comes from China. They need to hold/buy treasuries to manage their currency (ie keep it weak). If they don’t, their export competitiveness suffers which is last thing that gov will allow. They have other ways of managing the situation.
- baq 5y agothe fed are clowns. inflation data should have been priced in as anybody worth their salt (or indeed anybody doing any kind of shopping, which is everyone) knew that inflation would print above expectations, especially fed's. today's reaction was... panic of uninformed volume?
- ethbr0 5y agoThe Fed never said they weren't expecting inflation: they said they expected any inflation to be transitory (e.g. to return to expected levels by the end of 2022/23). So, we'll see.
- anm89 5y agoI would say that is still not a very credible claim.
- HFguy 5y agoIt wasn’t priced in or the market would not have moved. “everyone knew that Inflation would be above expectations” you should think about this more. Regardless, why does any of this make the feds clowns?
- baq 5y agoBecause I’ve been positioned in the market for inflation since February. If I could figure that out, what were they doing?