UK At 80% Risk Of Rating Downgrade On Current Debt Plan:PIMCO

chucky

Rinoa wrote: »

http://ftalphaville.ft.com/blog/2010/01/06/120931/uk-debt-is-still-wanted/

Invertors can't wait to get their hands on government paper as today's gilt auction is covered 2.68 times.

from your article

Now, the strong demand is not entirely surprisingly. Indeed, it was predicted by many commentators.

except for the expert armchair ecnomists on MSE who predicted a Gilts strike

Meanwhile, over on FT Alphaville’s sister blog, Money Supply, Chris Giles reckons no rating agency would dare downgrade UK debt when it can fund itself so easily and cheaply.

that's not what they saying on MSE!!!!

Thrugelmir

chucky wrote: »

from your article
except for the expert armchair ecnomists on MSE who predicted a Gilts strike


that's not what they saying on MSE!!!!

Doesn't take much to get the bulls excited........

Nothing to see here in reality. 5 year short dated issue that the BOE will no doubt buy back using QE.

The healthy demand for the paper was expected, "given the pressure on U.K. banks to buy the so-called high grade quality assets that gilts are meant to be on their bank capital books, with the patent cheapness of the stock relative to its peers, and the very steep profile of the front of the U.K. gilt curve offering obvious attractions," said Marc Ostwald, Monument Securities strategist.
Furthermore, Wednesday's Bank of England buyback made the auction even more attractive, he added.
Jason Simpson, market strategist at Royal Bank of Scotland, agreed, saying the issue should also be eligible for the BOE's three-year to ten-year buyback expected on Jan. 20.

Depending on how quotes get edited to fit web pages, can be misleading.

http://online.wsj.com/article/BT-CO-20100106-703598.html?mod=WSJ_latestheadlines

HAMISH_MCTAVISH

In an auction of £4bn 5-year UK government debt this morning, the issue was covered 2.68 times - more than the equivalent auction in December - and the highest yield paid was 3.082 per cent.

No credit ratings agency would dare downgrade UK debt when it can fund itself so easily and cheaply.

The rise in UK government bond yields since the Christmas period started has been matched in other countries and in the 5- and 10- year contracts in the overnight index swap market.

The markets therefore suggest that rising government bond yields reflect expectations of higher official interest rates in the years ahead - good news because economies are recovering - rather than an increase in credit risk.

Once again, the MSE/HPC doom-mongers get smacked by a good dose of reality.

You'd think they'd learn by now....:money:

chucky

Thrugelmir wrote: »

Doesn't take much to get the bulls excited........

Nothing to see here in reality. 5 year short dated issue that the BOE will no doubt buy back using QE.



Depending on how quotes get edited to fit web pages, can be misleading.

http://online.wsj.com/article/BT-CO-20100106-703598.html?mod=WSJ_latestheadlines

how could the BOE try to buy back 2.68 times the allocation??

they would only be able to buy 1 times the allocation - it would have still been over 1.68 times :rolleyes:

these bears don't seem to be very clever or have any decent arguments to make any more

purch

Next Wednesday will give us a far clearer picture of the Debt climate.

Mr.Brown_4

Rinoa wrote: »

http://ftalphaville.ft.com/blog/2010/01/06/120931/uk-debt-is-still-wanted/

Invertors can't wait to get their hands on government paper as today's gilt auction is covered 2.68 times.

Yes, looks good on the surface.

But I fear it will not help those who are maxed to the limit of loans. If anything it looks likely that the interest rate rises are coming closer.

Still, its an ill wind, etc. I for one am over the moon about this news.

chucky

Mr.Brown wrote: »

But I fear it will not help those who are maxed to the limit of loans. If anything it looks likely that the interest rate rises are coming closer.

can you explain why?

no, didn't think that you could - NEXT bear please!!!!! :rolleyes:

Mr.Brown_4

chucky wrote: »

can you explain why?

no, didn't think that you could - NEXT!!!!! :rolleyes:

Actually I can, but I fear you woudl not understand. Simply put the variables involved point to a further increase in the fuctuation reserve, this over the differentials already in place woudl limit normal median bias, but as expected by those of us who were, er expecting it, the radial symetry has been preserved by a flexible stimulus.

chucky

Mr.Brown wrote: »

Actually I can, but I fear you woudl not understand. Simply put the variables involved point to a further increase in the fuctuation reserve, this over the differentials already in place woudl limit normal median bias, but as expected by those of us who were, er expecting it, the radial symetry has been preserved by a flexible stimulus.

as expected total waffle - but you get a Thanks for trying. well done :T

abaxas

Can someone explain why the huge spread over base?

Ie the spread is huge now, wasnt before.