US Treasuries: the lessons from March’s market meltdown

Financial Times/Colby Smith and Robin Wigglesworth/7-28-2020

Artist rendering of a black hole“’There was a point in time when we were wondering if the bond market would really ever function again,’ says Nick Maroutsos, co-head of global bonds at Janus Henderson, an investment group. ‘If it continued for a couple of weeks, we were thinking we were looking at doomsday.’”

USAGOLD note:  A retrospective that tells how close we came to a full bond market meltdown this past March.  The issue, it seems, was liquidity and the Fed filled the gaps. “I understand why the Fed did this, but they basically bailed them out,” says [former New York Fed chief Bill] Dudley. “There’s definitely a moral hazard here.”  The bond market is the black hole at the center of the fiat money universe – the focal point around which all else rotates. Smith and Wigglesworth offer a deep weekend read ……

This entry was posted in Today's top gold news and opinion. Bookmark the permalink.