Bond Market
Bond Market |
- 6 month Treasury
- 2 Year Treasury
- 10 Year Treasury
- 30 Year Treasury
- Municipal Bond Index
- High Yield - Junk Bond Index
6 Month Treasury |
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2 Year Treasury |
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10 Year Treasury |
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30 Year Treasury |
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High Yield - CCC or Below |
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High Yield - Junk Bond Index |
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Arguments for Inflation |
In simple terms you have to much money (demand) chasing to view goods and services (supply).
Concerns:
- The Fed is printing a ton of money
M1 Money Supply to Real GDP |
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Federal Government Debt to Real GDP |
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Link: U.S. Debt Clock
Arguments for Deflation
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In simple terms you need cash & credit to create the demand necessary to push prices higher, in an age of deleveraging you have less credit to create that demand so competition puts downward pressure on prices.
Concerns:
- Consumer Credit Outstanding
- Interest payments on the national debt reduces potential for Federal spending
- Velocity of Money Supply (money is not changing hands fast enough)
- Debt Held by Foreign Investors
Consumer Credit Outstanding to Real GDP |
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Interest on National Debt |
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Velocity of Money Supply |
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Total U.S. Debt Held by Foreign Investors |
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Debt Held by Foreign Investors as % of GDP |
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By far the biggest player in the game is the Federal Government. On that score it's important to note:
2016
Source: www.whitehouse.gov/omb/budget (see The Budget / Summary Tables, Page 100)