Treasury Carnage Begin: The First Sign of Financial Collapse
Source: YouTube · Eurodollar University · published Dec 7, 2024 · 20:45
The treasury bill market is showing unprecedented demand for 8-week bills 0:07, signaling that financial markets don't believe the "strong economy" narrative being promoted by officials.
Key Takeaways:
• A massive, unprecedented bid for 8-week treasury bills occurred at Thursday's auction, with the bid-to-cover ratio soaring to nearly 3.5 7:01, something the commentator has never seen before.
• The household survey shows employment fell by 355,000 in November after falling 368,000 in October 1:53, with the adjusted unemployment rate at 4.78% when accounting for labor force participation drops 3:00.
• Primary dealers have been rapidly building up Treasury coupon inventories 14:02, which historically signals collateral scarcity and deflationary pressures.
• This pattern of treasury bill market behavior correlates with payroll reports and reflects market skepticism about the actual health of the US economy 18:00.
The treasury bill market movements are symptom of a larger monetary system issue where collateral scarcity is emerging as participants anticipate economic weakness 19:01.
Sources:
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First 800 characters of the transcript
just wild stuff in the treasury bill Market this week right before Friday's payroll report came out just a a massive monstrous bid for 8we bills at the auction on Thursday one I don't recall ever seeing anything like it before obviously rates plunged and bills are supposed to be boring but more recently they haven't been funny thing was something similar happened last month bills dropped sharply right before the October payroll report came out so as stunning as this latest auction was it actually wasn't an isolated occurrence there has been a pattern of behavior pointing in the direction of something like this since early August repo fails continued to be elevated primary dealer Holdings of us treasuries have spiked again right before what happened this week let's not forget the rising dol…