Archive for January 13th, 2009
Bonds and Unemployment
It had never occurred to me before. why should it? but a link between unemployment and bond rates. But looking over some unemployment charts today, the looked all too familiar. they looked like something else.
This is the best chart i could find to post on bond yields, but is incomplete. only goes up to 2000. you can see a full view of the 10 year treasury bond chart here.
This is an unemployment chart. there is certainly not a 1:1 relationship, but it is interesting to see how similar these charts look. Bond prices top out in 1981, then in 1983 unemployment peaks.
In 1969 unemployment found a bottom, by 1970 bonds bottomed. in 74 bonds peaked, by 75 unemployment peaks. and the trend seems to continue holding. At bottoms, unemployment seems to lead by about a year, at tops bonds seem to lead by about a year.
For now i havent gathered together the economic reasons and implications this has. Just that unemployment is saying bonds are going to go higher. Thing is, people have been writing about bonds flying higher since 1995. Theyve done the exact opposite.
Sources: bigPicture, thedigerati life
Head Hunters
well, thought the Fed cleared this up. it certainly is not as bad as in october/november, but C is really the big worry here.
| C-Z | CITIGROUP CAP VIII | 14.85 | 132,038 | -1.37 | -8.45% | 39.48 |
| C-I | CITIGROUP INC PFD | 25.00 | 600,610 | -1.25 | -4.76% | 41.33% |
| C-G | CITIGROUP CAP XX | 15.94 | 82,619 | -1.23 | -7.16% | 40.31% |
| C-F | CITIGRP CAP XIX PFD | 14.50 | 214,037 | -1.20 | -7.64% | 41.87% |
once again, in the fall these preferred shares were dropping 20% in a day. but 7% is still a big number. when the debt holders are fleeing, smart and big money is jumping ship. thats never good.
there are some other names like BAC, and shockingly FCX, that are starting to do similar things. but it isnt en mass–yet.
