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Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

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Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#71

Post by tick_tock_tick »

coredev_ wrote: post #39
kavalg wrote: post #24

Earlier quoted context omitted.

But I am having a hard time identifying this union/nation. Unfortunately, it feels like the EU is set on a downward trajectory.

I'm a bit baffled by this - are you saying that you can't identify a single market in the whole world that is worth to invest in & stable except US? Also I don't see that EU as a whole is on a downward trajectory, there are a lot of areas that are super strong, one being the defence industry. US on the other hand - who wants to invest in or trade with them when they treat the rest of the world (including close friend…

I mean there is a second almost if not more critical requirement which is has a big enough and liquid enough debt market to function like US treasuries.

> Also I don't see that EU as a whole is on a downward trajectory

That's an extremely contrarian take that you can't justify with EU defense did good for once in it's life. Maybe we'll see something from the EU but remember the USA and EU GDP were basically identical 10 years ago now the US is 50% bigger.

Seriously in 2008 the EU had a bigger GDP and now is a fraction of the USA and member nations have done basically nothing to fix the core issues that left them behind.

> US on the other hand - who wants to invest in or trade with them when they treat the rest of the world (including close friends) as shit.

Sadly it doesn't really matter about a "want" it's a need at this point unless people are going to cut off their arm and collapse their own economies they don't really get a choice.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#72

Post by toast0 »

zppln wrote: post #9

What are some realistic alternatives to US markets here? Selling is one thing, the question is what to buy instead? I mean, everyone starting to buy european instead would be great for stock prices, but it wouldn't make the underlying assets more valuable, right?

If you divest US bonds, you would probably put them into bonds from other nations (and corporate bonds from non-US companies), easiest thing is to try to find a index to track; Vanguard's BNDX tracks the Bloomberg Global Aggregate ex-USD Float Adjusted RIC Capped Index (Hedged).

In a mark to market world, the value of a bond is its acquisition cost, so buying bonds enough to raise prices increases their value, but not their coupons or their face value. It's hard to make sense of the value of a sequence of payments, it's reasonable to consider the present value and the market price is an easily justified present value for a bond.

Selling bonds and buying stocks is a different thing altogether. Selling US stocks and buying EU stocks wouldn't change the value of the underlying assets, however, having an increased stock price does have benefits for the company when issuing new shares or bonds.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#73

Post by deadbabe »

arnonejoe wrote: post #60
stackghost wrote: post #15

Earlier quoted context omitted.

Avalanches can start with a single stone. EU together with UK and Canada hold more Treasurys than the entire rest of the world combined, and if they dumped them all at once it would be significantly painful for the average American as interest rates would spike, as would inflation. The Dollar would decline against most other major currencies. However dumping that much debt all at once would require the sellers to hea…

The fed would almost certainly intervene aggressively resuming large scale QE to buy up treasuries and stabilize yields.

What if the fed ceases to exist soon?

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#74

Post by loeg »

vkou wrote: post #69
loeg wrote: post #58

Earlier quoted context omitted.

You've answered a different question than the one I asked. I think the US will continue to pay its debts, under this president and the one who replaces him in three years.

This president has publicly mulled not paying its debts. It's time to stop magical, wishful thinking about how you want the world to be, and deal with the world as it is.

The president can mull whatever he wants; he doesn't have the authority to not pay.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#75

Post by deeg »

jakobnissen wrote: post #4

A brief search suggests this is around 1/4000th of the total US treasury market, so if this has any significance at all, it's symbolic.

It seems like if they are trying to put pressure on the US government it might be easier to dump Tesla stock. Maybe the billionaires and MAGA would buy to keep it propped up but if it turned into a selling frenzy musk could be in trouble.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#76

Post by ViewTrick1002 »

arnonejoe wrote: post #60
stackghost wrote: post #15

Earlier quoted context omitted.

Avalanches can start with a single stone. EU together with UK and Canada hold more Treasurys than the entire rest of the world combined, and if they dumped them all at once it would be significantly painful for the average American as interest rates would spike, as would inflation. The Dollar would decline against most other major currencies. However dumping that much debt all at once would require the sellers to hea…

The fed would almost certainly intervene aggressively resuming large scale QE to buy up treasuries and stabilize yields.

Which would lead to inflation right? Leading to these bonds having even lower value?

Showing that you don’t want to be the last one out since either the risk or inflation hits you.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#77

Post by vkou »

loeg wrote: post #74
vkou wrote: post #69

Earlier quoted context omitted.

This president has publicly mulled not paying its debts. It's time to stop magical, wishful thinking about how you want the world to be, and deal with the world as it is.

The president can mull whatever he wants; he doesn't have the authority to not pay.

He can mull all he wants and half the time, that mulling turns into reality.

In practice, he has the authority to do anything he wants. Who is going to stop him? You? His pets in Congress? JPow's private hit squad? Clarence Thomas?

The first rule of neo-America is that you're playing the Chairman's Game[1], and there are no more rules. Its counterparties should bargain with it accordingly.

---

[1] https://en.wikipedia.org/wiki/Mao_(card_game) [2]

[2] The Chairman's Game is a game invented in a university. Some say it was invented at Stanford, while others say it was invented at MIT. It was inspired by a formerly prominent, but now somewhat disgraced Chinese politician that was famous for coming up with a lot of interesting new rules for his subjects to follow, and enforcing those rules very harshly, without necessarily informing those subjects what those rules were. It's a little bit like Uno, a little bit like Crazy Eights, and the only thing that I can tell you about it is that there are times, when playing this game, when it is not a good idea to speak.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#78

Post by willturman »

ectospheno wrote: post #40

An equally valid headline is "Investors purchased $8B of US Treasury Bonds". Never really got the point of people announcing US Treasury sales like its a big thing. Someone else not thinking with their emotions can, and will buy them. Its like announcing publicly you are selling your Honda. Its your Honda bro, sell it.

"Investors purchased $8B of US Treasury Bonds from the non-issuing entity."

If you're Honda, you'd prefer that the purchaser of any Honda is purchasing their Honda from Honda. Honda doesn't care about the secondary sale of any one Honda, per se, but they'd certainly care if people start opening dealerships with fleets of effectively brand new Hondas immediately next to every Honda dealership.

Additionally, every seller that was a previous long-term holder represents decreased demand for Treasuries at the primary auction. Mark Carney put it eloquently yesterday during his speech with his analogy of "taking the sign out of the window". This represents someone taking their bid out of the auction.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#79

Post by tick_tock_tick »

zppln wrote: post #9

What are some realistic alternatives to US markets here? Selling is one thing, the question is what to buy instead? I mean, everyone starting to buy european instead would be great for stock prices, but it wouldn't make the underlying assets more valuable, right?

There aren't any it's why the US takes in such crazy flows.

Re: Swedish Alecta has sold off an estimated $8B of US Treasury Bonds

#80

Post by blipvert »

forgetfreeman wrote: post #12
jakobnissen wrote: post #4

A brief search suggests this is around 1/4000th of the total US treasury market, so if this has any significance at all, it's symbolic.

"There have been spontaneous demonstrations amongst the workers voicing their joy and gratitude at our happy new way of life." - Orwell, more or less.

Faith Collapsing!

https://www.youtube.com/watch?v=68DJCaqEpDc

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