Le Metropole Bulletin: Bond trader's problems due to inverted yield curve.

greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread

12:49 EST from Bill Murhphy's e-notice for gold updates.

See: Le Metropole.com

Rumors are sweeping Wall Street that a primary bond dealer is going under as a result of the Treasury's announcement that it is reducing 30 year Treasury bond supply.

The Fed has denied an emergency session has been called,but does not deny a big dealer in trouble.

30 year bond yields have collapsed in a very short period of time from 6.76% to 6.06%. Forward price 30 years are even lower in yield.

There are many market players caught the wrong way on yield curve trades as the curve has now inverted in what must be record time.

>From a Cafe European bond dealer:

"something should happen because this thing is lethal for all asset swappers"

Banking stock index diving.

Meanwhile, the cash market for oil products are on fire with cash prices way above NYMEX. Situation very explosive.

Gold only up $1.40 in this VERY BULLISH gold market environement. Manipulation crowd desperate to hold gold price down to avoid a gold derivative blow up as is occuring in the bond market.

-- Bill P (porterwn@one.net), February 03, 2000


Care to post that link again? It didn't work for me...

-- Tim (pixmo@pixelquest.com), February 03, 2000.

Rumors are sweeping Wall Street that a primary bond dealer is going under as a result of the Treasury's announcement that it is reducing 30 year Treasury bond supply.

The Fed has denied an emergency session has been called,but does not deny a big dealer in trouble.

30 year bond yields have collapsed in a very short period of time from 6.76% to 6.06%. Forward price 30 years are even lower in yield.

There are many market players caught the wrong way on yield curve trades as the curve has now inverted in what must be record time.

>From a Cafe European bond dealer:

"something should happen because this thing is lethal for all asset swappers"

Banking stock index diving.

Meanwhile, the cash market for oil products are on fire with cash prices way above NYMEX. Situation very explosive.

Gold only up $1.40 in this VERY BULLISH gold market environement. Manipulation crowd desperate to hold gold price down to avoid a gold derivative blow up as is occuring in the bond market.

More later

Le Metropole Cafe

-- Bill P (porterwn@one.net), February 03, 2000.

I don't question the data but I sure don't understand it. Why would anyone want to lend money for 30 years at a lower rate than they would lend it for 5 years?

-- Lars (lars@indy.net), February 03, 2000.


It is called an inverted yield curve. The 30 yr T-Bill is issued at a fixed rate of interest over 30 years. Bonds trade daily and the price of the T-Bill fluctuates with current market conditions just like common stocks. When the price of the bond goes up due to increased demand the percentage of interest is recaluclated based on the new price.

USUALLY, when the FED raises the FED interest rates, bond prices fall so that the current yield stay competitive with current interest rates. BUT supply and demand as well as Futures trading impacts the bond market.

What appears to be happening now is that some big money has been buying up the long bond. Rumors are it is the US Treasury using the same methods as the infusion of cash liquidity for pre-Y2K cash requirements - that is swapping greenbacks for bonds.

This is in effect paying off the national debt (as stated by President Clinton) using printing press dollars from the Treasury to replace the long bond debt obligations of the federal government. It is also called "Monetizing the debt" because instead of just counting the amount of outstanding bond obligations to figure the national debt, the debt is obscurred in the increased supply of fiat dollars.

The result is a weaker, perhaps much weaker, dollar and increased, perhaps much increased commodity inflation - higher oil, gold, silver, food etc prices.

In light of the current oil supply reductions and oil inventory draw downs this is potentially a very serious, dollar threatening, action.

Our international trading partners will not be happy with a weaker dollar and an increase in our gross trade imbalence. This could lead to alternativer currencies, like the Euro, taking precedence in international trade as in OPEC oil sales.

-- Bill P (porterwn@one.net), February 03, 2000.

Lars, It`s not that they want to lend it at a lower interest rate,it`s that the money has already been lent, in the form of bonds, but the price of those bonds, are going up, forcing the yield down. Bonds are constantly traded on the open market, just like stocks. Lower price means bigger return. High price means less return.

-- Earl (earl.shuholm@worldnet.att.net), February 03, 2000.

From another thread on this forum:

http://moneycentral.msn.com/investor/news/breakingarticle.asp?ArticleI D=OBR,2000/02/03,2875 Link

Treasuries Skyrocket, Market in Turmoil February 3, 2000 01:31 PM Eastern Time

Breaking News Headlines By Daniel Sternoff

NEW YORK (Reuters) - U.S. Treasury prices skyrocketed in wild, extremely illiquid trading on Thursday as rumors swirled about financial institutions in trouble and market players sought to cover short positions in longer-dated paper.

The market was roiled as financial institutions sought to bail out of trades that were bleeding money over the past week after the yield on the 10-year note offered a better return than the 30-year bond, traders said.

``Honestly, I'm confused. What am I looking for? I'm going to try to still be employed tomorrow,'' said a trader at a U.S. bank.

The 30-year Treasury bond (US30YT-RR) surged nearly three points higher, 10-year notes (US10YT-RR) were up nearly 1-1/2 points and five-year notes (US5YT-RR) bounded more than a full point higher.

Short-term bill rates, meanwhile plunged sharply lower.

Several players cited rumors that the Federal Reserve was arranging an emergency meeting with bond dealers to address the recent wild volatility and the unusual yield picture. A spokesman for the New York Fed said the rumors were ``completely unfounded'' after initially declining to comment on them.

``Rumors of financial institutions in trouble are causing the flight to quality,'' said Mark Mahoney, chief Treasury market strategist at Warburg Dillon Read LLC.

``There are rumors going around about a hedge fund in trouble, dealers in trouble. There is a little bit of concern about liquidity and accounts blowing up so you've got a little bit of flight to quality here,'' said a trader at a U.S. primary dealer.

``People are looking for substantiation (of rumors) and they haven't been able to get it. Until it's denied, they are going to believe that it is true,'' the dealer said.

Prices receded a touch from their highs, and near 1:00 p.m. (1800 GMT), the 30-year T-bond was up 2-14/32 at 100-9/32, yielding 6.1 percent.

10-year notes were up 1-6/32 at 97-5/32 yielding 6.40 percent and five-years were up 26/32 at 97-20/32 yielding 6.47 percent.

The sharp and sudden climb in prices came on top of strong gains earlier as the market was shaken by continued aftershocks from the Treasury Department's announcement on Wednesday of its plans to cut the supply of longer-term government debt.

The Treasury, flush with surplus budget funds, said it plans to buy back some $30 billion of older, higher yielding debt this year.

The announcement Wednesday, which indicated buybacks and a worsening supply squeeze in long-dated issues, sent prices on long-term bonds soaring and their yields down sharply.

The sharp moves have catapulted yields on short-term debt above longer maturity issues, an irregular phenomenon known as yield curve inversion which has traders scrambling to readjust positions and portfolios.

Bonds normally yield more than shorter-term paper, compensating investors for the longer-term risk that bond yields might fall behind inflation.

Detailing its buyback plan on Wednesday, the Treasury said repurchases would start within two months in initial chunks of around $1.0 billion. It also said it would reduce some debt issuance and would hold a bond auction only in February.

The plan has helped send long-term interest rates into a downward spiral even as the Federal Reserve is jacking short-term rates higher to ward off inflationary pressures in the booming U.S. economy.

The Fed on Wednesday raised two key interest rates by 25 basis points, in line with Wall Street's expectations, and the Treasury market barely flinched.

Deputy Treasury Secretary Stuart Eizenstat on Thursday shrugged off criticism that the buyback plan had been mistimed, saying debt reduction in times of surplus was positive and would result in lower long-term interest rates.

Many market players expect the Fed to continue to modestly ratchet up interest rates in the months ahead.

Traders are looking to a key U.S. employment report on Friday for any fresh signs of price pressures, but some say supply distortions are reducing the impact of economic data.

Three-month bill rates fell nine basis points to 5.41 percent, six- month bill rates dropped 14 basis points to 5.52 percent, and year bill rates fell 13 basis points to 5.70 percent. A basis point is 1/100 of a percentage point.

-- Bill P (porterwn@one.net), February 03, 2000.

There is the matter of derivatives; certain positions have become losing positions in very short order. The Fall-out from the derivatives market has yet to rear its ugly, public head. U.S. bankers are highly involved in derivatives trades that are stock, and BOND positions. I would not be surprised if there was a SERIES of emergency meetings regarding BIG losers and institutions threatened with insolvency. Long-Term Capital Management was a hedge-fund that was on the losing end of certain derivative positions. The FED stepped in to broker a deal with their financing banks since LTCM would have been forced to dump untold amounts of paper onto the markets inorder to satisfy their lenders.

There is, I suspect, a run on ulcer remedies in the financial institutions. Whipsawing markets and derivatives (as high as 125 trillion globally) are not compatible entities. The foundations will shake and fall before John Q. Public hears about it. Based on all written about these financial instruments(derivatives), this is a terrible time for these markets. When the "side-bets" on a market are rivalling the size of the markets themselves...well, that ain't a recipe for stability. When the "side-bets" are leveraged to a far greater degree than the markets themselves...time will catch up with this foolishness.

I've wondered whether the "replacement system" for our current financial system is already being developed or completed;I find it very hard to believe anyone would expect the seas and oceans of paper assets to hold their credibility and "currency" much longer.



-- (He Who) Rolls with Punches (JoeZi@aol.com), February 03, 2000.

Bill P:

I thought government bonds had three designations: T-Bills (everything up to 5 years maturity; T-Notes (5 to 10 year mediun term maturities; and everything over 10 years was a T-bond with the 30 year bond sometimes referred to as the Long-Bond. Is this right or am I just splitting hairs?

Anyway - here is a good link explaining inverted yield curves.


-- Teague Harper (tharper@cyberhighway.net), February 03, 2000.

Here is another story along these same lines:

This is a small statement from the story:

By most accounts, bond buying Thursday morning was more concentrated and intense than anyone remembered since the stock market crash of October 1987.

-- Teague Harper (tharper@cyberhighway.net), February 03, 2000.

Teague Harper or anybody else:

Why? Why would there be more long bond buying just now than at anytime since 1987. What prompted the binge buying? The US Govt may be buying up a little debt 1.0 billion (which is less than minuscule compared to our total debt) at a time starting a few months down the road should not have, a sudden, major impact now. What the hell is going on?

The only thing that's changed is the FED bumped interest rates another .25% The US government is spreading out there repurchase of debt to have as little impact as possible. Why should bond traders be confused?

Unlike your average Joe sixpack, I have a desire to KNOW the implications but don't have a clue as to what they are.

-- Guy Daley (guydaley@bwn.net), February 03, 2000.

Here is one of the best explanation of bonds and the importance of the yeild curve. Great job by SmartMoney. Hope this helps you bond newbies.

In case anyone was watching the crude oil scene today it was interesting yet again. The supply crunch in the northeast has now spread south. It'll only get worse tonight again with many terminals out of product. I keep hearing that there are boats on the way from Europe, but they're making some damn slow time of it. First one to new york harbor makes a zillion! Also we had a Russian ship siezed in the Persian Gulf. I can't think of a dumber thing for us to do at this time. Bill Clinton is making some pretty scary moves here. After all, it's not "drunk Boris" in the Kremlin anymore. It's "scary Vlad" who likes to pee on his dead enemies. We should tread very lightly. What's a few thousand barrels of gasoil for god's sake. Lighten up Bill, this will not be a legacy, but a disaster.

Tommorrow should be interesting. The bond markets are so large that they sometimes impact commodities when they're moving fast. I suspect there are some real illiquid problems out there in bond land. We've had one official denial of the emergency fed mttg., now all we need is one or two more to confirm the problem. Also, in case anyone missed it, the Vens caught a bad case of bearish diarreah of the mouth. You'd of thought the guys we're net short crude for god's sake. Blah, blah, Opec will balance prices, doesn't want price to high, gaurantee's low oil prices. This guy must be getting one hell of a nuthug from our financial folks. In other words there's a squeeze on, of the testicular variety.


PEOPLE TALK ABOUT interest rates going up and going down as if all rates moved together. The truth is, the rates on bonds of different maturities behave quite independently of each other with short-term rates and long-term rates often moving in opposite directions simultaneously. What's important is the overall pattern of interest- rate movement -- and what it says about the future of the economy and Wall Street. Rates are like tea leaves, only much more reliable if you know how to read them. The yield curve is what economists use to capture the overall movement of interest rates (which are known as "yields" in Wall Street parlance). Plot today's yields for various maturities of U.S. Treasury bills and bonds on a graph and you've got today's curve. As you can see on the adjoining chart, the line begins on the left with the shortest maturity -- three-month T-bills -- and ends on the right with the longest -- 30-year Treasury Bonds.

Normal and Not Normal Ordinarily, short-term bonds carry lower yields to reflect the fact that an investor's money is under less risk. The longer you tie up your cash, the theory goes, the more you should be rewarded for the risk you are taking. (After all, who knows what's going to happen over three decades that may affect the value of a 30-year bond.) A normal yield curve, therefore, slopes gently upward as maturities lengthen and yields rise. From time to time, however, the curve twists itself into a few recognizable shapes, each of which signals a crucial, but different, turning point in the economy. When those shapes appear, it's often time to alter your assumptions about economic growth.

To help you learn to predict economic activity by using the yield curve, we've isolated four of these shapes -- normal, steep, inverted and flat (or humped) -- so that we can demonstrate what each shape says about economic growth and stock market performance. Simply scroll down to one of the curve illustrations on the left and click on it to learn about the significance of that particular shape. You can also find similar patterns within the past 18 years by running our "yield-curve movie" and -- by clicking the appropriate box -- you can compare any shape within that time period to both today's curve and the average curve.

Normal Curve Date: December 1984 When bond investors expect the economy to hum along at normal rates of growth without significant changes in inflation rates or available capital, the yield curve slopes gently upward. In the absence of economic disruptions, investors who risk their money for longer periods expect to get a bigger reward -- in the form of higher interest -- than those who risk their money for shorter time periods. Thus, as maturities lengthen, interest rates get progressively higher and the curve goes up.

December, 1984, marked the middle of the longest postwar expansion. As the GDP chart above shows, growth rates were in a steady quarterly range of 2% to 5%. The Russell 3000 (the broadest market index), meanwhile, posted strong gains for the next two years. This kind of curve is most closely associated with the middle, salad days of an economic and stock market expansion. When the curve is normal, economists and traders rest much easier. BACK TO APPLET

Steep Curve Date: April 1992 Typically the yield on 30-year Treasury bonds is three percentage points above the yield on three-month Treasury bills. When it gets wider than that -- and the slope of the yield curve increases sharply -- long-term bond holders are sending a message that they think the economy will improve quickly in the future.

This shape is typical at the beginning of an economic expansion, just after the end of a recession. At that point, economic stagnation will have depressed short-term interest rates, but once the demand for capital (and the fear of inflation) is reestablished by growing economic activity, rates begin to rise.

Long-term investors fear being locked into low rates, so they demand greater compensation much more quickly than short-term lenders who face less risk. Short-termers can trade out of their T-bills in a matter of months, giving them the flexibility to buy higher-yielding securities should the opportunity arise.

In April, 1992, the spread between short- and long-term rates was five percentage points, indicating that bond investors were anticipating a strong economy in the future and had bid up long-term rates. They were right. As the GDP chart above shows, the economy was expanding at 3% a year by 1993. By October 1994, short-term interest rates (which slumped to 20-year lows right after the 1991 recession) had jumped two percentage points, flattening the curve into a more normal shape.

Equity investors who saw the steep curve in April 1992 and bet on expansion were richly rewarded. The broad Russell 3000 index (right) gained 20% over the next two years. BACK TO APPLET

Inverted Curve Date: August 1981 At first glance an inverted yield curve seems like a paradox. Why would long-term investors settle for lower yields while short-term investors take so much less risk?

The answer is that long-term investors will settle for lower yields now if they think rates -- and the economy -- are going even lower in the future. They're betting that this is their last chance to lock in rates before the bottom falls out.

Our example comes from August 1981. Earlier that year, Federal Reserve Chairman Paul Volker had begun to lower the federal funds rate to forestall a slowing economy. Recession fears convinced bond traders that this was their last chance to lock in 10% yields for the next few years.

As is usually the case, the collective market instinct was right. Check out the GDP chart above; it aptly demonstrates just how bad things got. Interest rates fell dramatically for the next five years as the economy tanked. Thirty year bond yields went from 14% to 7% while short-term rates, starting much higher at 15% fell to 5% or 6%. As for equities, the next year was brutal (see chart below). Long- term investors who bought at 10% definitely had the last laugh.

Inverted yield curves are rare. Never ignore them. They are always followed by economic slowdown -- or outright recession -- as well as lower interest rates across the board. BACK TO APPLET

Flat or Humped Curve Date: April 1989 To become inverted, the yield curve must pass through a period where long-term yields are the same as short-term rates. When that happens the shape will appear to be flat or, more commonly, a little raised in the middle.

Unfortunately, not all flat or humped curves turn into fully inverted curves. Otherwise we'd all get rich plunking our savings down on 30- year bonds the second we saw their yields start falling toward short- term levels.

On the other hand, you shouldn't discount a flat or humped curve just because it doesn't guarantee a coming recession. The odds are still pretty good that economic slowdown and lower interest rates will follow a period of flattening yields.

That's what happened in 1989. Thirty-year bond yields were less than three-year yields for about five months. The curve then straightened out and began to look more normal at the beginning of 1990. False alarm? Not at all. A glance at the GDP chart above shows that the economy sagged in June and fell into recession in 1991.

As this chart of the Russell 3000 shows, the stock market also took a dive in mid-'89 and plummeted in early 1991. Short- and medium-term rates were four percentage points lower by the end of 1992. BACK TO APPLET

In this section: The One Bond Strategy | Bond Allocation | Investing for Income | Investing for Profit | To Swap or Not? | A Bond Primer | Ten Things Your Broker Won't Tell You About Bonds | Bonds vs. Bond Funds | The Living Yield Curve | Bond Calculator | Glossary | Creating a Laddered Bond Portfolio

Home | Contact Us | Help | Search | Symbol Lookup | Five-Day Archive| User Profile

SmartMoney.com ) 2000 SmartMoney. SmartMoney is a joint publishing venture of Dow Jones & Company, Inc.and Hearst Communications, Inc. All Rights Reserved. Please read our terms and conditions and our privacy statement. All quotes delayed by 20 minutes. Delayed quotes provided by S&P Comstock. Historical prices and fundamental data provided by Media General Financial Services. Earnings estimates provided by Zacks Investment Research. Insider trading data provided by Thomson Financial.

-- Gordon (g_gecko_69@hotmail.com), February 03, 2000.

Thanks Gordon,
Here is the Link to the article.

-- Possible Impact (posim@hotmail.com), February 03, 2000.

Thanks Gordo. I was beginning to wonder what had happened to you. Thanks again for your freely given introspection.

-- Earl (earl.shuholm@worldnet.att.net), February 03, 2000.

I think there are two recent actions:

The FED raised interest rates.

And the US Treasury is buying up 30 yr bonds.

This puts the US Treasury (Summers) at odds with the FED (Greenspan).

The FED raised rates to fight inflation and the Treasury redeemed bonds for greenbacks which weakens the dollars and fuels inflation.

It appears that major bond traders had inculded the FED rate increase in their positions but were surprised by the actions of the Treasury.

It could be that the Clinton/Gore adminstration are acting on their own to mitigate the ecpnomic slow down implied by the FEd rate hike. Thiscould be to keep the economy and stock market (bubble.com humming at least until after the primary and maybe until after the fall election.

looks like politics at its worst and I suspect Greenspan and the FED were surprised (and angered) too. I say this because I doubt the bond traders would have positioned themselves so poorly if the FED knew about the timing of the debt monetization/bond redemption. The FED is owned by the major investment banks and not an official governement agency and maybe outside this political loop by Clinton/Gore amd Summers.

-- Bill P (porterwn@one.net), February 03, 2000.

Is this surprise bond problem the catalyst to pop bubble.com?

-- dinosaur (dinosaur@williams-net.com), February 03, 2000.

I think more is at stake than bubble.com.

Perhaps Japan is selling off their load of US T-Bills in heavy volume and the Treasury is mopping them so that the Japanese action does crash our debt markets.

See:Japan is issuing mucho Japanese Yen bonds and the Japanese govt is borrowingheavily from private banks

It looks like Japan can finance at lower rates than the US offers and their Japanese bond would not be exposed to weaker dollar currency fluctuation risk.

-- Bill P (porterwn@one.net), February 03, 2000.

I'm hoping William Fleckenstein will call in his Contrarian Rap for a special Friday edition at siliconinvestor.com since he's been mentioning bond wars in his previous commentaries.

-- dinosaur (dinosaur@williams-net.com), February 03, 2000.

Only to be used For Educational/Discussion Purposes


by Sherman H. Skolnick


A reported emergency has been developing regarding two major banks and a major bond and gold trading firm. The highly secretive Federal Reserve, America's PRIVATE central bank, is reportedly considering the possiblity of an emergency session. The necessity apparently of an emergency session has been caused in part, or in whole, by the following:

[1] Rumors have apparently been sweeping Wall Street that one of the world's largest, if not THE largest bond and gold trading firm, Goldman Sachs, is possibly going under. This stems reportedly in part from the U.S. Treasury's announcement that it is reducing 30 year Treasury Bond supply. Goldman Sachs reportedly has been heavily speculating in derivatives, that little-understood, highly dangerous tinkering with assets inside of assets inside of and linked to underlying assets. {Remember how Orange County California went bankrupt by their reported speculating with these mysterious manipulations called "derivatives".] Goldman Sachs reportedly has been in the forefront of worldwide efforts to knock down the price of gold and reap huge profits at the expense of workers and stockholders of the gold mining industry.[A South African gold mine went into bankruptcy in 1999 when the "wreck the price of gold" crowd, including the Bank of England, forced gold down to just over 250 dollars per ounce. The average cost of production of gold, by the best, most efficient mines, is about 285 dollars per ounce.]

The derivative gambling, in the trillions of dollars, is a complex formula of tricks, involving gambling on gold and oil and Treasury Bonds, all interwoven like a group of Chinese magic boxes inside of boxes inside of boxes.

When gold shot up from 252 dollars per ounce to 330 dollars per ounce in the fall of 1999, some contended at the time that Goldman Sachs and other gold trading houses were heavily SHORT on gold and could not come up with the gold supply to make good the LONG speculators that reportedly included worldwide financial pirate George Soros. At the time, there was reason to believe that Goldman Sachs would invoke an emergency clause, used when there are storms, wars, and revolutions interfering with complying with contracts, called Force Majeure. [For background see our prior story: "Bank of England and the Gold Crisis", on our website.]

[2] Goldman Sachs is reportedly in a sinking boat with Germany's huge financial ship, Deutsche Bank, and the worldwide bank octopus Bank of America. This trio are major players in Foreign Exchange, called ForEx, trading and speculating in foreign currencies. If the emergency continues, the Federal Reserve, according to some bond and gold experts, would have to come up with some 600 Billion Dollars, as a rescue attempt for the reputed trio of bust financial players. According to other financial sources, the Federal Reserve can come up with 130 Billion dollars, that is, some say, "the limit of the number of lifeboats the Fed can supply in a hurry". Beyond that, some experts contend, the Fed would have to order the printing of a flood of paper money, falsely masquerading as the "U.S. Dollar", in fact, Federal Reserve notes backed by nothing but hot air.

[3] Do not expect the sphinx-like Federal Reserve to admit there IS an emergency and that they are considering an emergency session of their highly-secretive deliberations.

Some extremely well-informed financial experts have their views posted on a website called: http://www.LeMetropoleCafe.com [a summary can be obtained, but further details require you to be a subscriber]. They quote a bond dealer as saying "something should happen because this thing is lethal for all asset swappers".

[4] Bank of America, headquartered in San Francisco, already is facing billions of dollars of problems as the result of a suit filed in U.S. District Court in San Francisco. The details of that suit have been publicized primarily only by us. It is a class action on behalf of victims, heirs, and beneficiaries, of World War Two whose assets were stolen by the Nazi puppet government of Croatia, the Ustasha, and later secretly deposited during and after the war reportedly with the Vatican Bank. [Emil Alperin, et al vs. Vatican Bank, No. C99-4941 MMC, in the U.S. District Court, Northern District of California. Details of the suit as well as the complete First Amended Complaint are on our website: http://www.skolnicksreport.com under the title "Vatican Bank Sued For Alleged War-Crimes"]. Little- known by the public, and rare if ever mentioned by the monopoly press, Bank of America, and its parent holding firm, Bank America, are owned jointly by the Vatican Bank, the Jesuits, and the Rothschilds. In recent years, also a major owner of Bank America reportedly have been the Japanese mafia, the Yakuza which own a major interest in most every bank in California. Seldom reported, the Yakuza are major dope traffickers in the U.S.

What may come of the situation, which some financial experts contend is an emergency or an emergency developing? An inflation may develop as a result of the Federal Reserve ordering up a huge supply of paper money to be used to bail out the reported sinking ship containing Goldman Sachs, Deutsche Bank, and Bank of America. The price of gold would go UP if the so-called "U.S. Dollar" goes DOWN. Further, Clinton would welcome an emergency, real or fabricated, so he could stay in office beyond the expiration of his term. Those close to him have been quoted as saying they heard Clinton say he would not mind staying beyond his term by some emergency. And will an emergency, real or fake, intefere with U.S. Presidential election? Stay tuned.


Since 1958, Mr.Skolnick has been a court reformer. Since 1963, founder/chairman, Citizen's Committee to Clean Up the Courts, disclosing certain instances of judicial and other bribery and political murders. Since 1991 a regular panelist, and since 1995, moderator/producer, of one-hour,weekly public access Cable TV Show, "Broadsides", Cablecast on Channel 21, 9 p.m. each Monday in Chicago. For a heavy packet of printed stories, send $5.00 [U.S. funds] and a stamped, self-addressed business sized envelope [4-1/4 x 9-1/2 #10 size] WITH THREE STAMPS ON IT, to Citizen's Committee to Clean Up the Courts, Sherman H. Skolnick, Chairman, 9800 South Oglesby Ave., Chicago IL 60617-4870. Office, 7 days, 8 a.m. to midnight, (773) 375-5741 [PLEASE, no "just routine calls]. Before sending FAX, call.


Hope this is more readable!

It seems this may scandal may be driving the fed and the bond markets.

-- Farouk Madjurian (fmadjurian@hotmail.com), February 04, 2000.

Gad, now even the bond market is acting like it's chock full o' dot-coms. Dropped like a stone (as in -2!) this morning after yesterday's unheard-of run-up. Recovering a bit now and "only" -30/32. Some of those hedge funds and derivatives traders must be popping Zantac like it's a breath mint.

And unless there was some sort of data feed problem this morning for S&P500 stocks, there appears to have been a truly massive and extremely brief sell-off of "something" around 10:45AM. The index recovered almost immediately. Whatever that "something" was, it was neither a DJIA nor COMP component, as those other indices didn't even blink when the S&P dropped more than 1.5% in less than 5 minutes. I'm almost inclined to think that it was just a problem with the S&P data itself, rather than a real reflection of market activity, but who knows?

Wonderous, indeed...

-- DeeEmBee (macbeth1@pacbell.net), February 04, 2000.

Moderation questions? read the FAQ