For everyone under 110 who’s never experienced a down market…
This is what ‘29 felt like.
— Jon Boorman (@JBoorman) March 6, 2020
i think the bond mkt is basically confirming a lot of death coming
— AGTrader (@ag_trader) March 6, 2020
Sovereign Bond Yield Collapse Shows the World Is in Crisis Mode
German yields closed in on record lows and those on short-dated U.K. debt neared 0% as the market braces for more stimulus from central banks.
(Bloomberg) — Global central banks have no room to fight the crisis caused by the coronavirus outbreak, according to Deutsche Bank AG. “Policy failure is here,” George Saravelos, the bank’s global head of currency research, wrote in a note. #covid19
— Carl Quintanilla (@carlquintanilla) March 6, 2020
The speed at which treasury yields are tanking is absolutely frightening. We now have a 100% chance of a 50+ point rate cut in 12 days. A >1/6 chance of a 75 basis point cut.
Treasury Yields Hurtle Toward Zero as Bets on Fed Cuts Mount: Bloomberg
Treasury yields plummeted to record lows Friday as concern about the global economic and financial impact of the coronavirus spurred demand for havens and traders amped up bets on further central bank easing this month.
“We are staring at the abyss of a credit crunch.” t.co/FxQIy4hH4X
— Lisa Abramowicz (@lisaabramowicz1) March 6, 2020
#Velocity of #Money was collapsing before the #CoronavirusOutbreak. It will probably get worse now.
Monetary policy will not be enough to reverse course. Expect fiscal & other (new) measures to be introduced.
We are witnessing M2 velocity collapse & a global shortage of USDs pic.twitter.com/yeBPYzTehL
— Michael Nicoletos (@mnicoletos) March 6, 2020
Investors Withdraw Most Cash From U.S. Credit Funds in a Decade
Investors withdrew $12.2 billion from U.S. funds that buy corporate bonds and loans, the biggest weekly total in at least a decade, as the spreading coronavirus battered markets globally.
Indeed t.co/4FtRPT57ey t.co/1oWL8nEbgv
— Carl Quintanilla (@carlquintanilla) March 6, 2020
Imo it is going straight down to 0%
The recession is here
— A.Urban (@AlessioUrban) March 6, 2020
This is absolutely horrifying.
Rick Santelli on @CNBC says we should consider giving coronavirus to everybody to just get it over with.
That way it won’t wreak so much havoc on the economy.
This is your brain on capitalism.pic.twitter.com/Uv5UYyKtxy
— Joshua Potash (@JoshuaPotash) March 5, 2020
To those, who say that #China has plenty of room to resuscitate. 👇#recession t.co/9To0kmPm2q
— Tuomas Malinen (@mtmalinen) March 6, 2020
twitter.com/MI_Investments/status/1235925316343750656
Oh boy, the market is pricing in ANOTHER 50 basis point cut by the Fed on 3/18…
Current level = 100-125, there is a 37%21.5%0.5% chance it will be cut to 75-100, and a 63% 78.5% 99.5% chance it will be 50-75.
I do not claim to know when a crisis will occur. But if we are already at such low rates now, when it really isn’t that bad, what are we going to do when banks start going under? Is every central bank going to go negative on their rates, tens of trillions of QE?
Oh, boy, I am super worried, this is going to be worse than 2008 because the world has far more debt and far lower interest rates than we did back then prior to the crisis. We also counted on China for our recovery the last time, but we will have no such luck this time because their economy is probably in worse shape than the US is due to demographics and a housing bubble in Beijing, Shanghai, Guangzhou and Shenzhen so large, that they easily rival the bubbles of NYC, SF, Toronto or Vancouver.
There is a 1/6 chance that they will cut to 25-50 (a 75 basis point cut)? What does the market want? Negative rates by June? Is the S&P 500 headed below 1000 points?
“Wall Street Stock Pros Fess Up: ‘We Don’t Know What’s Going On’” -Bloomberg
10 Year Treasury Yield Hits All Time Low Under 0.7%
The yield on the benchmark 10-year Treasury note sank to 0.695% around 4:45 a.m. ET, breaking below 0.7% for the first time ever.
Sequoia Capital Calls Coronavirus “the Black Swan of 2020”
The last time Sequoia did something similar was in October 2008, at the peak of the financial crisis, via its famed “RIP Good Times” slide deck. The firm is known for placing early bets on such companies as Airbnb, Google, and WhatsApp.
Demand for Fed’s Repo Loans Surges Past $100 Billion a Day
Federal Reserve Chairman Jerome Powell certainly has an odd notion of what constitutes an “orderly” market.