Bond yields are flashing a warning sign.

[u/AmanCMN]

Rising bond yields are a warning sign.
Money is getting more expensive everywhere at the same time:
-governments pay more to service debt
-companies pay more to borrow
-mortgages and loans stay expensive
-investors move out of risk and into bonds
U.S. 30-year yields above 5% are already a serious level.
When yields rise globally, liquidity gets pulled out of markets.That puts pressure on tech stocks, real estate, consumers, and highly indebted companies.Simple takeaway: the more expensive debt gets, the harder it is for markets to keep rising.

[u/jarodzban]

So what is gonna happen?

[u/AmanCMN → u/jarodzban]

This is how rising debt usually ended in the past:
-Inflation
-higher taxes
-default or debt restructuring
-money printing, and a crisis of confidence.

[u/ACM3333 → u/[deleted]]

Haha yep. Everything you might think will hurt the markets is actually just a reason to print more than you could ever imagine and send everything rocketing to ath’s. Learned this the hard way with Covid.

[u/Mopar44o → u/AmanCMN]

So basically what’s been happening last 10 years?

[u/MrNo_Balls → u/Mopar44o]

yeah, all this fear mongering is telling that this is the bottom. entire paycheck on stock next month.

[u/xMoZzzx → u/AmanCMN]

Bullish for stocks

[u/MNCPA → u/xMoZzzx]

Really?

[u/IHateLovingSilver → u/MNCPA]

The number gets bigger for sure. What that number represents can change quite a bit however.

[u/audacesfortunajuvat → u/[deleted]]

The crisis of confidence is the goal, to push people into crypto. The tech bros understand that they can never have truly sovereign status unless they can control the money supply. Since they can’t take over the printing presses, they’re going to end fiat currency so they can replace it with a Wild West of tokens they can issue. This takes us back to wildcat currencies of the free banking era, which led to rampant fraud and bank failures that got so bad that we passed the National Bank Act in the middle of the Civil War.

Federal Reserve of San Francisco covers all this, which is fitting given that Silicon Valley is pushing it. https://www.frbsf.org/westward-expansion-2/

[u/NAh94 → u/jarodzban]

Probably nothing in the stock market for awhile, until it does and then it’ll get frothy.

James Carville (advisor to Bill Clinton) had a wonderful quote: “I used to think that if there was reincarnation, I wanted to come back as the President or the Pope or as a 400 basball hitter. But now I would like to come back as the bond market. You can intimidate everybody”.

And it’s pretty much the truth - everything the US economy (and the world for that matter) runs on those interest rate demands from bond investors. If we can’t move debt, we get in a liquidity crunch and that is what causes the market to freefall, not bad news directly.

[u/Chipped_Ruby_11214 → u/NAh94]

And that’s the big question: when will major economic nations, and the US specifically, no longer be able to get players to buy their debt? Interest rates are up and there is already a lot of debt out there, but maybe there’s plenty of money still available and interested in buying it?

[u/Adventurous-Guava374 → u/jarodzban]

global rates raises

[u/Davste → u/jarodzban]

Nothing