TLT - 20Yr Bond ETFThe Monthly Chart continues to expand in Range.
This is interesting as the Range Broadens the implications
are quite Dire longer term.
TLT was sold heavily prior to the ROC SPike in TNX.
ZN was sold on Volume as well, an Instrument we have repeatedly
discussed for its weakening structure.
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Attempting to apply "Convention and Rationale" to an aging Trend
is generally, an Idea whose validity should begin to come into question.
FASB 56 alone is enough to bring the operations within the Shadows of
the Bond Market under duress over time.
It is clear the BIS is backstopping this operation - at what cost, we can
only surmise.
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The Real Issue moving forward for the Bond Complex is one of simplicity.
Rates will, in the Short Ter react to Policy and the perceived threat of
Inflation.
Shadow Operations will require time to unfold, but we believe this process
has begun, it will not be brought into he light of Day any time soon, but will
eventually, appear in the form of unexplained loss of confidence around the
Globe.
This will, of course, be devastating to the US Dollar. rendering it a 50 Level
once 82 and then 77 are broken.
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The competition between China and the United States is well underway
and is accelerating on many fronts.
With the US Losing its advantages due to its inability to produce Value
across former dominant Sectors of Global Trade - a 22nd Century pivot to
Asia will continue to gain in both scope and scale, as well as velocity.
Financial Isolationism within the approaching rebalancing of Global
financial Arrangements will render the US to a weighted SDR status
with less than favorable terms and conditions.
This will have a devastating effect on the US Bond Market.
The curve will be converted to a Perpetual Duration with Principals
retired. A balance sheet liability which cannot be reduced without
far greater and far more insidious distortions.
It can never be eliminated.
Never, it is not mathematically possible. Therefore it will be erased to
bring balance. Think of it as the FDIC/SPIC coming to save $250K of your
$20 Million.
You lose, they win.
They default in an extraordinary manner and provide token assurance
that... one day... they swear to make you whole.
It will never happen.
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This is axiomatic, pure, and simple.
Regardless of the Gyrations... The Future is not "Uncertain" with respect
to Bonds and how they will be all but eliminated.
