Europe’s Economic Troubles Push Investors Toward 10-Year Note
Source: NY Times
Unnerved once again by Europes economic problems, investors rushed to buy United States government securities on Wednesday, sending the yield on the Treasurys 10-year note down to a record low.
Stock prices, meanwhile, fell sharply on Wall Street after a broad sell-off sent Europes markets down 2 percent or more. Analysts said the Treasury rally, as well as the selling in the European stock markets, was set off by new signs of weaker economic activity on the Continent.
Almost the total focus on where the flight to quality is coming from is Europe, said Kevin H. Giddis, the executive managing director and president for fixed-income capital markets at Morgan Keegan & Company.
I did not think we would gain so much momentum over a very obvious issue that has no quick fix to it, Mr. Giddis said. There is a lot of cash coming in to U.S. Treasuries from everywhere.
Read more: www.nytimes.com/2012/05/31/business/daily-stock-market-activity.html
FBaggins
(26,697 posts)If only it were an option for more people.
muriel_volestrangler
(101,154 posts)The US is just one of many:
In Germany, the 10-year has fallen to a new record of 1.33 percent. UPDATE: And the German 2-year bond yield has now just fallen to ZERO.
U.K. borrowing costs have hit a record low of 1.73 percent.
In Finland, the yield on the 10-year is 1.624 percent. You guessed it, that's a record low.
Sweden: The 10-year yields 1.405 percent. Same deal.
In Australia, the 10-year has dropped close to a record low of 3.061 percent.
Canadian 10-year yields at 1.87 percent are close to a record low.
Japan's 10-year: 0.85 percent.
Swiss 10-year: 0.59 percent.
http://www.businessinsider.com/sovereign-bonds-falling-all-over-the-place-2012-5
Jeez, the UK is in a recession, and it's still got low bond yields. This amounts to "these governments really will pay this stuff back", but, as the British trade union economist Duncan Weldon argues, this does not mean that the British, or any other economy, is doing well, whatever the UK government argues.