Article

2011-03-09 Economy

World Biggest Fund Dumps Treasury Bond Holdings

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Posted by Matt 2011-03-09 16:55|| || Front Page|| [11129 views ] Top

#1 Probably related.

Posted by newc 2011-03-09 17:28|| 2011-03-09 17:28|| Front Page Top

#2 Why buy something that has a large risk of a negative return on your investment?

Posted by DarthVader 2011-03-09 17:28|| 2011-03-09 17:28|| Front Page Top

#3 "Okay, the bad news is the cancer has spread throughout your liver, so we're going to have to remove it."

"What's the good news?"

"Have I said anything to suggest there is good news?"

Posted by Anonymoose 2011-03-09 18:47|| 2011-03-09 18:47|| Front Page Top

#4 Hokay, so Pimco sold all their treasuries.

Who bought 'em?

Posted by Steve White 2011-03-09 19:02|| 2011-03-09 19:02|| Front Page Top

#5 Really good question, Steve, and I haven't been able to find any answer through some brief Googling. Believe me, I want to be optimistic about this.

Posted by Matt 2011-03-09 20:02|| 2011-03-09 20:02|| Front Page Top

#6 Who bought 'em?

The US government.

Posted by phil_b 2011-03-09 20:27|| 2011-03-09 20:27|| Front Page Top

#7 I was afraid you were going to say that.

To clarify, as I understand it PIMCO has been reducing its treasuries position for months - today was the day it hit zero (or they claim it hit zero - these guys are bond traders, after all.) But it's extraordinary that you can have a $236B fund run by some very serious fixed-income professionals without having a nickel in treasuries, even if just on the chance that they might be wrong about the basic call. And I think that when this news hit the wire a whole bunch of Chinese officials went "Whoa! Dude!"

On the other hand, the yield on the ten-year hasn't moved squat.

Posted by Matt 2011-03-09 21:37|| 2011-03-09 21:37|| Front Page Top

#8 What odds interest rates will go up in the near future?

Posted by trailing wife 2011-03-09 23:18|| 2011-03-09 23:18|| Front Page Top

#9 What odds interest rates will go up in the near future?

100% unless QE III is implemented and is so massive as to dwarf I & II combined. Pimco's Treasury exit is more a confirmation of the fact that they're thinking along these lines than anything else.

Posted by AzCat 2011-03-09 23:54|| 2011-03-09 23:54|| Front Page Top

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