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US bonds safe for investors says Geithner
Cincinnati Sun
Monday 8th February, 2010
US Treasury Secretary, Timothy Geithner, has expressed confidence that warnings from Moody's ratings agency will not deter investors.
In an interview on ABC television, Mr Geithner said investors would never snub US Treasury bonds.
He said: "If you look at what has happened throughout this crisis, when people were most worried about the stability of the world, they still found safety in Treasuries and the dollar."
Geithner said the Obama administration would take measures to reduce the country's deficit, which is now in the trillions of dollars.
The latest projection for the deficit is 1.556 trillion dollars; a record for the US.
Moody's Investors Service recently said the US would need to be tough in taking action to get its finances in order to avert problems in the coming years.  Email this story to a friend
Comments on this story
| By secret slave, 02-08-10, 11:42 PM |
Geithner says there will always be investors for US bondssalaam,
Adjustments of corrections,
The GDP rating system is incompleted,
it is not single in value,
it was double in value,
raw bounty = raw product,
production = procession,
two values gathered does not make one value !
DOUBLE in the least amount in value !
NOT SINGLE value for it is two gathered is not single in value !
feeamanellaah |
| By waltky, 05-23-10, 04:02 AM |
| The canary in the coal mine?...
:confused:
Bonds ring economic alarm bells
May 21, 2010 — Economists generally aren’t worried about the U.S. or global economy falling into another recession. Looking at the bond market, many investors don’t agree.
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The yields on long-term U.S. Treasurys, such as the benchmark 10-year bond, have tumbled sharply over the last six weeks, hitting as low as 3.1% in early trading Friday before they rebounded to 3.2% late in the day. Some experts say this is a sign a lot of major investors are betting on tough times ahead. “There is big money making big bets that at a minimum we we’ll have a recession if not a depression that could last for years," said Kevin Giddis, managing director of fixed income at Morgan Keegan. “It’s a scary scenario to subscribe to, but that’s the current one being batted around."
It’s not a theory that Giddis agrees with; he believes the U.S. economic recovery is strong enough to withstand any problems with Greek debt and the euro. But he thinks that the market has been too spooked by fears of another economic downturn. He believes the trading has moved beyond the typical flight-to-quality that can drive down bond yields and drive up bond prices at times of uncertainty. “There’s a risk aversion trade and a fear trade, but we’ve taken this to a level on steroids," he said.
In early April as the U.S. economy was posting signs of growth and the fears were that it would lead to inflation down the road, bond yields started to rise, as they typically do in such an economic environment. The yield on the 10-year closed at just under 4% on April 5, the highest level since just before the crisis in financial markets started in August 2008. If anything, some economists were worried that rates were starting to rise to levels that could choke off signs of a rebound in housing. With the Federal Reserve having completed its purchase of $1.25 trillion in mortgages, the rate on the 30-year fixed rate mortgage rose to 5.21%, the highest level in eight months.
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