Watch yields across the board carefully. About to explode. You don’t need the same exact conditions as 2008 to have an outcome like 2008.

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Analysts assess contributors to the unusual 60 basis point rise in 10-year UST yields.

“As I’ve said before, guys, you don’t need the same exact conditions as 2008 to have an outcome like 2008. You just need a bubble and a catalyst. 2008 was a bank liquidity crisis much more than it was a housing crisis. Now, we have a bubble three times the size we had then, and three catalysts: 1) Deposit account balances are dropping significantly. This is causing the reverse repo funds held at the Fed to be collapsing in real time. 2) Many credit cards and loans are not performing now and are 30-90 days delinquent. Commercial real estate losses are staggering and short-term rental housing loans are also rapidly going under. 3) Treasury yields are going in the wrong direction. Banks all hold a significant amount of their reserve assets in treasuries, which have taken significant losses since 2022. Right now, banks don’t have to report those losses as long as they hold the bonds to maturity. But if money gets tight, they would have to book those losses and risk insolvency in some cases, if they sold any treasuries at the losses they currently hold.”

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4.29%… 1968 all over again where no one wants to buy U.S. Treasuries.

Interest rates are about to double to 9%


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