September 3, 2010 – Have Treasury Bonds Had it?

Featured Trades: (TREASURY BONDS), (TBT), (TMV)

 


1) Have Treasury Bonds Had It? You are probably tired of my yammering on about how close we are to a multigenerational peak in Treasury bond prices by now.

If you missed my last three pieces on the topic, click here for ‘The Great Bond Market Crash of 2010′, click here for ‘Don’t Buy That Treasury Bond”, and click here for ‘Get Ready for the Sack of Rome’.

After yesterday’s dramatic price action, which saw my preferred vehicle, the double leveraged (TBT) up 5% on the day, and the (TMV) tacking on a blistering 10%, you may be forgiven for thinking that the fat lady is getting ready to sing. Take a look at the chart below of the gargantuan cash flows into bonds, and you know that if this is not the top, it is not far off. Listening to the cheerleaders on CNBC applauding the pop in equities and the slide in bonds yesterday, you’d think it was a done deal.

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Is the Fat Lady Singing in the Treasury Bond Market?