Economic Meltdown (seconda parte)

[kandrathe]

Horsepuckey. First, it's not a ponzi scheme. It shares nothing in common with a ponzi scheme. That's just a scary word people use when they want to frighten the horses. Second, that article is from 2009, which in post-crisis US bond terms, is pretty much the stone age. QE1 and QE2 are dead and gone - and yet, bond prices have gone *up*. If the markets were dumping US Bonds, then the instant QE2 ended, they would have crashed. Did they? Not even close. Most of the debt is 90 day? Great! 3 month yields are ... 0.02! Like, free fraking money. The US could go to Vegas on the defense budget, and markets wouldn't so much as blink. Don't take my word for it - these are actual, honest to god, up to date, bond prices.

I await movement in the opposite direction. Record highs do not stick around forever. But this is not the Fed keeping this afloat. That's what QE is, and they aren't doing any more of it right now - yet no crash.

-Jester

Ponzi was the articles take on it since it is unclear who is buying and who gets paid. QE2 ended June 30 2011.

People are fleeing to T-bills as a safe harbor. Even though the yield will be nearly zero, or slightly negative, it's better than riding a crash down. It's probably a signal of an impending stock market meltdown. We'll see tomorrow, when the markets open.