Thursday, July 01, 2010


taking a cue from Krugman i was looking at back data on US treasury yields, since everyone is obsessed with an immediate need to cut the deficit;

Ten years ago we were looking at 6.58% on the 10yr, 6.94% on the twenty yr, 6.61 % on the 30 yr

Twenty years ago, 7.98 % 10yr, 20 yr N/A, 8% on the 30 yr

Here are what those yields were as of yesterday: 2.97% on the 10 yr, 3.75% on the 20yr, 3.91% on the 30yr

Short term is even better, in 1990 the 3 yr bond was 7.9%, ten years ago it was 6.43%, today...1.00%. Investors are willing to take on US debt for 1% return.

Meanwhile the consumer price index shows us down 0.2% month over month.

Long term unemployment at record highs, investors jumping over each other to buy US debt that offers barely any returns, and the specter of deflation begins to take hold. im no econometrist, but are those pressing calls for fiscal contraction? a need to cut back spending and reduce short term deficits?

the icing on the cake will be when obama's deficit commission releases its report after the elections and announces an immediate need to slash social security, with its trust fund overflowing with surplus at the moment, or we will see the end of america as we know it.

on a last note I was going over polling on the issue of debt. its a huge concern with voters, except when offered to rank it against "jobs" or "job creation" at which point it pales in comparison. bring on the republican majority

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