Category Archives: Bonds

Redacted Version of the October 2014 FOMC Statement

September 2014 October 2014 Comments Information received since the Federal Open Market Committee met in July suggests that economic activity is expanding at a moderate pace. Information received since the Federal Open Market Committee met in September suggests that economic activity is expanding at a moderate pace. No change. This is another overestimate by the […]

The Butterfly Machine

There’s a phenomenon called the Butterfly Effect.  One common quotation is “It has been said that something as small as the flutter of a butterfly’s wing can ultimately cause a typhoon halfway around the world.” Today I am here to tell you that for that to be true, the entire world would have to be […]

Mantra: Interest Rates Have to Rise, Interest Rates Have to…

I thought of structuring this post like a fictional story, but I couldn’t figure out how to make it good enough for publication.  Well, truth is often stranger than fiction, so have a look at this Bloomberg article pointing at a 37% loss in the ProShares UltraShort 20+ Year Treasury (TBT). A few points to start […]

Numerator vs Denominator

Every now and then, a piece of good news gets announced, and then something puzzling happens.  Example: the GDP report comes out stronger than expected, and the stock market falls.  People scratch their heads and say, “Huh?” A friend of mine who I haven’t heard from in a while, Howard Simons, astutely would comment something […]

Time to Chase Bill Gross?

Jason Zweig at the Wall Street Journal had a very good piece on whether to follow Bill Gross as he goes from Pimco to Janus.  Let me quote one paragraph: Morningstar estimates that over the past five years, the average investor fell behind Pimco Total Return’s 5.6% annual gain by 1.6 points a year—largely as […]