Posted To: MBS Commentary
When someone asks a salty old bond market person why rates are doing what they'd doing, they might get a seemingly dismissive reply: "supply and demand!" No duh, salty old bond person. Of course supply and demand is going to determine the price of almost anything, but we were looking for the factors underlying the supply and demand. And the salty old bond guy might reply: "No, dummy. I mean SUPPLY and demand! Look: https://home.treasury.gov/news/press-releases/sm1001 " In other words, the conversation would concern the actual announcement of additional supply. Granted, a certain amount of supply is always to-be-expected when it comes to the bond market. Moreover, we already knew that Treasury supply would have to increase substantially in order to finance the coronavirus…(read more)
Source: Mortgage News Daily
