Leftback said...
This is a nice set-up for a YC steepener. Shorts at the long end have been thoroughly Edward the Seconded, and now even the Permabulls have signed on with the West Coast crowd and come over all New Normal.
You'd have to say that the BoJ aren't exactly high 5-ing each other to see USDJPY 76.xx this morning and so the chance of some concerted intervention is rising, now if the US can create even ONE job this week, we may see a sharp reversal in Treasuries, as a double dip is all but priced in here.
Maybe the best risk-on entry point for a while here? Continued US weakness means low rates, easy policy as far as the eye can see. Equity markets typically find intermediate lows on bad news, such that any more positive trend in ensuing data points trigger short covering rallies.
