Keep an eye on the 3 month T bill rate ...that dictates to the Fed
UnknownUnicorn4195243
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@gosball, I still believe the Fed uses off-the-balance sheet liabilities to dictate short term rates, even more than what they declare...but investors have a much greater say in the 10-30y
gosball
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@SilverSerfer22, I am pretty new to this ( trying my hand at pure technical trades) but what I have seen is that the Feb reacts to the 3M ...generally behind the curve ..any tips for me on technical trading ?
UnknownUnicorn4195243
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@gosball, the fed does not react to the 03MY, the same banks whose CEOs, CFOs and CIOs are all members, advisers and shareholders at the fed are the ones who influence the 03MY...the 01MY is the best indicator for liquidity in the financial system which is correlated with financial asset prices...
gosball
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@SilverSerfer22, morning ...I beg to differ on this..if you look back or do a back test you will see the short term market is dictating to the Fed and not the long term...the Fed is forced to react to the 3M ...when the 3M starts moving up they will react ....behind the curve :)
UnknownUnicorn4195243
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@gosball, I think you should reread what I wrote and do a bit more research on your own:
The widespread belief that yields on government debt lead central bank policy (and not the other way around) only reflects a profound misunderstanding of the financial system on the part of most investors and can be easily disproved with one question: What would happen to yields on government bonds if central banks halted their actions tomorrow? They would explode, and all the BS about the FED following short-term yields would be revealed for what it is...
Central banks are not regulatory authorities, they are instruments of control used by governments and the largest banks to suppress interest rates and permit continual inflation, most of the people who work for and control the FED also work for and control the largest banks...
Through their operations (of which they publicly declare a mere FRACTION) and the use of dark pools (in which the FED is HEAVILY involved), they control the 01MY, the 03MY and every single interest rate on planet earth...
I am well versed in the teachings of Jeff Snider, perhaps the most expert proponent of deflation and the idea that the bond market controls the FED and not the other way around, but once you truly delve into the beast that is the global fiat monetary system, especially from an Austrian perspective, you realize that the central banks are in control of EVERY single monetary, financial and economic event that occurs
gosball
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@SilverSerfer22, Operation Twist ?...trying to get inflation can come back and bite.
UnknownUnicorn4195243
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@gosball, remember, inflation is not higher prices, it is the expansion of the money supply
gosball
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@SilverSerfer22, expanding money supply faster than real output is the problem....too much debt and then you have hyperinflation