As I type, the eurodollar futures curve is exactly 200 bps inverted, solidly Holy Crap territory. US Treasuries aren’t far behind in terms of historical upset, while an unprecedented inversion in the market for Germany’s government debt gets more unprecedented by the day, week, and month.
In purely technical terms, all these together are betting heavily on lower interest rates all over the world in the not-too-distant future. As they’ve come to be this distorted and ugly, formerly aggressive central bankers who’ve been hiking rates as fast as they can are suddenly coming around to that possibility, too.
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