Demand for Treasury securities is still high

By Edward Harrison On Jul 6, 2009

10-Year TIPS were sold with a Bid/Cover ratio of 2.51. Almost half of the securities went to indirect bidders, meaning central banks are still bidding for U.S. government debt.

Obviously, there is no problem for Treasuries despite the huge supply.

The positive interpretation here is that there is still a significant bid for U.S. debt despite all the talk of loose fiscal policy hurting demand. The negative interpretation is that concern about the probability of recovery is starting a flight to quality.

bonds United States

Edward Harrison 7783 posts 575 comments

Edward Harrison is a senior Editor at Bloomberg. He is also the founder of Credit Writedowns newsletter, a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.

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4 Comments

davosSherman says 15 years ago

I totally disagree with this. There is one reason to believe the person interviewed couldn’t find his rear end with both hands, a map, a gps and the lights on – inflation has NOTHING to do with cpi (which is as cooked as an Enron book). Inflation is the money supply.

We can argue all day long about banks not lending, but if China is divesting their dollar by buying commodities our USD is toast.

https://www.sprott.com/Docs/MarketsataGlance/June_2009.pdf
1. davossherman says 15 years ago
  
  PS This should have been what the media was locked in on today, it is the big news and will wag the inflationary dog (inflatonary Keynsian not Austrian)
  1. davossherman says 15 years ago
    
    forgot url https://www.bloomberg.com/apps/news?pid=newsarchive&sid=ahNFQdXZ6fNU

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