``The Treasury market’s problem is not theoretical. It’s not about the threat of investors discounting future inflation. It’s much simpler than that. It’s about simply choking on a barrage of new Treasury supply that’s running between $100 and $200 billion every week! There is no way that stocks, or corporate bonds, or GSE paper, or munis can compete with this supply. Today we saw first signs that the market can’t even absorb just the Treasury supply. As the interest rates rise on Treasuries as a result, we will be facing an unimaginable economic environment, one in which the world rightly questions the ability of the US Government to service its obligations.''

Comments: Be the first to add a comment

add a comment | go to forum thread