In Denial: AP Report Dodges Obvious Potential Reasons For Friday Dive in U.S. Bond Prices
When you increase demand for something, its price should go up. In the case of bonds, if the demand for them increases, their price should go up, and their effective interest-rate yield should go down. That didn't happen on Friday when the Federal Reserve began executing its second round of “money from nothing” quantitative easing. Even though the Fed increased demand, bond prices went down and yields went up. Why? If you read a late Friday afternoon report by the Associated Press's Matthew Craft you essentially get a bunch of blubbering “I don't know” statements (bolds after headline are mine): Treasury prices take a dive; Interest rates jump read more
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In Denial: AP Report Dodges Obvious Potential Reasons For Friday Dive in U.S. Bond Prices
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on November 14, 2010. Filed under