Kornelius Purps Quotes on Time (3 Quotes)

In all likelihood, disappointing data will at some point in time dampen rate hike expectations. There's a reasonably good chance for yields to move substantially lower over the course of this year.

Assume that a time machine is beaming you back to Monday morning. You start the week with the impression of an unexpectedly strong 274k US payroll report in mind. In addition, a clairvoyant tells you that 1) US retail sales surged by 1.4 m-o-m in April, 2) German growth advanced by 4 q-o-q annualized in Q1 2005, 3) speculation about a revaluation of the Renminbi will intensify, 4) the oil price will fall by about USD 3.50 per barrel this week, 5) and the US Treasury will sell USD 51 bn in Treasury Notes. You make up your mind and conclude that in this environment yields need to go up. At least 99 out of 100 market participants with the same information would have shared your view. But reality is different. Yields are down and down and down again. These are Schwarzenegger markets, no one can beat them.

In all likelihood, the time when obscure statements from FED Chairman Alan Greenspan caused analysts to ponder about the message between the lines will be over as Bernanke is expected to increase transparency by choosing clear-cut language -- more transparency, but less fun.