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Doesn't rhyme with 2009


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#1 steadyquest

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Posted 28 May 2020 - 04:06 PM

I had thought that the present situation was just a larger version of the earlier financial crises, but that crises occurred at the bottom of the long-term S&P/treasury yield channel, whereas we now sit at the top of the channel.  It seems, then, that the ratio will likely either break out above the channel (implying some fundamental change), or drop back into it, (implying lower S&P price and/or higher yields).

 

SPX-5-Y-Ratio.png

 

SPX-10-Y-Ratio.png

 

SPX-30-Y-Ratio.png

 

 

 



#2 Dex

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Posted 28 May 2020 - 04:58 PM

Can you estimate s&p price with the 10 year near current levels - to get back to the mid line.

 

It won't be going up much any time soon.


Edited by Dex, 28 May 2020 - 05:00 PM.

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#3 steadyquest

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Posted 28 May 2020 - 05:38 PM

Not readily since it is log scaling - but have at it.  Is there some significance to mid-line?  How long is "any time soon"?  It fell by over 2.5% in only 8 months time, and I would hesitate to predict where it goes from here or how quick it could change.  Need to see how the de/in-flation battle pans out.



#4 Dex

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Posted 28 May 2020 - 05:41 PM

Not readily since it is log scaling - but have at it.  Is there some significance to mid-line?  How long is "any time soon"?  It fell by over 2.5% in only 8 months time, and I would hesitate to predict where it goes from here or how quick it could change.  Need to see how the de/in-flation battle pans out.

 

Look at Europe ... they've been near 0 for years.


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#5 Dex

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Posted 28 May 2020 - 05:44 PM

I made a mistake.  I read the 30 yr as the 10 yr and didn't understand.  

 

I see the mid line is near 2,500.  I have that as a possible level for the next pull back.  


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#6 steadyquest

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Posted 28 May 2020 - 06:27 PM

I also made a mistake.  It took 16 months for the 10 year to fall by 2.5%.  I am not sure there is currently a firm basis for making comparisons between the US economy and Europe (or Japan).  Maybe just a bit further down the road to serfdom - but we are well on our way.  Need to commence the lynchings before too much longer.

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