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Dow dropped 816 yesterday. Didn't know.
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Dow dropped 816 yesterday. Didn't know.

2
May 22, 2025, 4:39 AM
Reply

What sparked the seloff? Headlines say the big beautiful spending bill in Congress. Nope. That's a part of it maybe but not the main reason.

They had an auction yesterday of 20 yr treasuries. This is the US government asking for people to buy US debt. The buyers though are changing. There are fewer and those who are buying are demanding higher returns, boosting yields. This goes counter to many things given our current metrics. No recession. Inflation is a nice 2.5%. The fed rate is 4.25%. Why are bonds not only remaining high but are going higher?

Because investors are losing faith in that which shall not be questioned. What's worse, very quietly the Fed is buying bonds as well, trying to increase demand. Think the fed has purchased over $40b in the last month. Without the Fed's assistance yields would be even higher.

We are seeing borrowing costs continue to increase not due to inflation, or fed rates, but a collapse of the dollar.

Giving the world the middle finger and becoming isolationist carries consequences. We're just entering the FO stage. We've FA plenty so far.

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Re: Dow dropped 816 yesterday. Didn't know.

1
May 22, 2025, 4:55 AM
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“We've seen several soft 20-year bond auctions and it has a checkered history as a benchmark issue," said Thomas Simons, chief U.S. economist at Jefferies in New York. "This one was not one of the best by any stretch of the imagination, but it also wasn't one of the worst."

"The 20-year bonds typically see less demand than other maturities, including the benchmark 10-year notes and 30-year bonds, which are favored by life insurance companies and pension funds."

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Re: OT but

1
May 22, 2025, 7:07 AM
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spending bill passed. Futures up. Hopefully makes up for yesterday's losses.

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Re: OT but


May 22, 2025, 7:16 AM
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I highly doubt it goes up 800.

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The spending bill isn't going to help. If anything it's part of the problem.

1
May 22, 2025, 11:13 AM [ in reply to Re: OT but ]
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https://www.mediaite.com/media/news/house-republican-shreds-trumps-big-beautiful-bill-as-titanic-level-debt-bomb/

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Metals and energy are the way to go

2
May 22, 2025, 7:27 AM
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IMG_8325.jpeg(49.4 K)
IMG_8326.jpeg(47.1 K)

Even with 2 big dips so far this week I’m in the green

And for the quarter

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“Anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that my ignorance is just as good as your knowledge.” Isaac Asimov
Panta Rhei Heraclitus


Re: Dow dropped 816 yesterday. Didn't know.

2
May 22, 2025, 8:22 AM
Reply

Wait a second now. Are you trying to tell me the Fed is using open market operations to influence the monetary situation? You may be on to something.

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