Posted To: MBS Commentary
I laughed out loud today–something I rarely do when reading typed words–after MBS Live cornerstone Sung Kim quipped “thank God China is buying today!” This joke works on so many levels. Much of the week was devoted to chasing a red herring of a story that claimed China was mulling a reduction in its US Treasury portfolio. Rational people or those who believed the things I was yelling knew the story was mostly bogus, but it went fairly viral nonetheless because it offered an explanation for market movement that was otherwise not easily explained. Cue this afternoon’s bond market rally. Bonds had just finished a fairly quick sell-off in response to this morning’s stronger CPI data. Apart from technical levels and potential “value buying” among traders who think they’ve…(read more)