Econ 101, The US Treasury Bond market - Democratic Underground

nomb

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Mon Aug-08-11 10:46 AM
Original message

Econ 101, The US Treasury Bond market

Edited on Mon Aug-08-11 11:08 AM by nomb

A number of posters seem to think the buyers flocking to US Treasury Bonds are rejecting the S&P rating. They are not. This is the wholly expected and predicted outcome. It is a stunning example to many of counter-intuitive output from the known input.

Read this from August 1, a full seven days ago:

http://money.usnews.com/money/personal-finance/mutual-funds/articles/2011/08/01/what-a-ratings-downgrade-would-mean-for-investors

There is nothing at all earth-shattering there in that simple news piece stating that US Bonds will be sought after and bought if the S&P rating is downgraded. It was also the guaranteed result if we had defaulted a few weeks ago. Yes, if we had failed to find agreement - people would have bought US Bonds in droves.

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nomb

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Mon Aug-08-11 11:37 AM
Response to Original message

1. Sorry, I thought I was being helpful. I guess today is for visceral reactions. :)

I've never made a good member of a mob.

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renate

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Mon Aug-08-11 11:41 AM
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2. Thank you!

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nomb

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Mon Aug-08-11 01:23 PM
Response to Reply #2

3. :) You're welcome. It's always nice to be appreciated, even if everyone thinks I'm wrong apparently

Oh well.

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Cestode

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Mon Aug-08-11 01:33 PM
Response to Original message

4. Thank you for that link.

Some sharp people here on DU.

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Mon May 06th 2024, 12:03 AM
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