
desertorchid
Members-
Content Count
491 -
Joined
-
Last visited
About desertorchid
- Currently Viewing Topic: Pandemic coming? - Coronavirus January 2021 onwards (Part 5)
-
Rank
Advanced Member
Recent Profile Visitors
1,154 profile views
-
Popuplights reacted to a post in a topic: What I have learned from the "Credit deflation" thread
-
Bedrag Justesen reacted to a post in a topic: Prince harry talks absolute bollox.
-
Dear god no, its coming. Unsurvivable!
-
There is no real reason for Bonds to keep going down, most bonds are pretty secure in terms of value, but will adjust to inflationary expectations. Personally I just cannot see the potential for wage inflation in the west which is a prerequisite to sustained inflation.
-
desertorchid reacted to a post in a topic: Bonds and Interest Rates- Can someone explain
-
They don't and its an incorrect statement. Although if bond prices are falling, it would only really be because of lack of liquidity (not likely now) or inflationary expectations. If the financial markets believe inflation is coming , then CB'c will as well (they are essentially from the same mindset), therefore "forced" to raise rates. However, as happened in 2010 and already been admitted now, CB's will hold off raising rates to maintain medium term inflationary pressures. It is true however, that the FED kind of leads the way on this.
-
Bornagain reacted to a post in a topic: Pandemic coming? - Coronavirus January 2021 onwards (Part 5)
-
JFK reacted to a post in a topic: "That's why I really want to get back to Britain because I know it will be taken care of - health-wise, at least,"
-
Loki reacted to a post in a topic: What I have learned from the "Credit deflation" thread
-
BurntBread reacted to a post in a topic: What I have learned from the "Credit deflation" thread
-
desertorchid reacted to a post in a topic: Online Sales Tax
-
Erewhon888 reacted to a post in a topic: What I have learned from the "Credit deflation" thread
-
stokiescum reacted to a post in a topic: What I have learned from the "Credit deflation" thread
-
What I have learned from the "Credit deflation" thread
desertorchid replied to BurntBread's topic in Investing & Money
I will be interested to watch your observations unfold and try to contribute when time allows. Love this comment and feel it is something that ties many dosbodders together: "I am, perhaps unusually, someone who can handle unlimited freedom without causing anyone else any problems, probably as I have no desire to control or change anyone. More than just finding it benign, I run on freedom like it is some kind of high-octane fuel, and I treasure it as a principal good in my life." Just an early thought: If you do go on a journey such as this one try and keep a very open mind. Investin -
GARCH reacted to a post in a topic: "That's why I really want to get back to Britain because I know it will be taken care of - health-wise, at least,"
-
Great Guy reacted to a post in a topic: "That's why I really want to get back to Britain because I know it will be taken care of - health-wise, at least,"
-
desertorchid reacted to a post in a topic: Property crash, just maybe it really is different this time
-
desertorchid reacted to a post in a topic: Not black or African enough - 6500 dead in Qatar.
-
BONDS (Treasury Bonds, Corporate Bonds etc)
desertorchid replied to Vendetta's topic in Property Prices & Economy
If you could buy at par, yes, but they're exchange traded so their price will fall as inflation rises along with other treasuries -
BONDS (Treasury Bonds, Corporate Bonds etc)
desertorchid replied to Vendetta's topic in Property Prices & Economy
Traditionally there is an inverse relationship between bond prices and stocks. Price movements depend on the risk attitude prevailing in the market at a particular time. It has been risk on for a few weeks now with stocks, bitcoin heading up, this fund has actually lost over 10% in recent weeks. Yesterday was just a slight pullback with the DOW losing most of FEB gains and funds like this getting a small reprieve, hence the 2% rise. -
desertorchid reacted to a post in a topic: BONDS (Treasury Bonds, Corporate Bonds etc)
-
BONDS (Treasury Bonds, Corporate Bonds etc)
desertorchid replied to Vendetta's topic in Property Prices & Economy
To be honest I am not clear what you think your missing here. Where the interest rate is increased by RPI.- Bond prices may change according to the risk associated with them The coupon and principal will automatically keep pace with inflation.- The coupon rate on an openly traded bond will not change. YTM will. In the primary market, coupon rates may change on new issuances to "get them away" Eventually the regular interest payments will be higher than the recently increased US Treasuries long term yield of 1.5% and the principal is protected against inflation as -
BONDS (Treasury Bonds, Corporate Bonds etc)
desertorchid replied to Vendetta's topic in Property Prices & Economy
Yes, you must consider YTM and not coupon rate. The mantra pre- QE was always "the market sets rates not the CB's", and to an extent this still true. Bond prices are still essentially dictated by the financial markets. "Temper tantrums " as we are seeing again now are the heightened anxieties shown by possible future inflation and impact on borrowing costs. In the 2009 aftermath, these emotional outbursts were intermittent but were ultimately tamed by post downturn inflation being reasonably muted and short term (although did go above 5% in the UK and Mervyn King had to hold his nerve). -
-
BONDS (Treasury Bonds, Corporate Bonds etc)
desertorchid replied to Vendetta's topic in Property Prices & Economy
They don't, but to think medium term inflation is baked in is equally foolhardy. The last 2 decades have consistently had false alarms on inflation. Holding bonds has been a one way bet in that time. -
BONDS (Treasury Bonds, Corporate Bonds etc)
desertorchid replied to Vendetta's topic in Property Prices & Economy
No Sage but would hazard a guess 9O% of the population haven't a clue what bonds even are.