MBS Day Ahead: Revisiting Bigger Picture After Yesterday's Losses

Posted To: MBS Commentary

Bonds remain generally strong despite yesterday's losses There continues to be a good line in the sand that can warn against a bigger shift Further losses would take rates back toward previously broken range of 2016 Yesterday's Day Ahead pointed out the stock/bond divergence and asked "which one is lying?" As I sifted through headlines this morning, I saw one to the effect of "stocks and bonds saying the same thing, but trust bonds ." I'm glad that's all cleared up! Seriously though, given the global sovereign debt situation (Treasuries are US sovereign debt) with over 10 trillion dollars now trading at negative rates, it's hard to make a case for 10yr US yields of 1.5% being too low. Whatever the case going forward, we can definitely saw that bonds have...(read more)

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