XJO 0.99% 7,896.9 s&p/asx 200

Even though this is primarily for our market, I thought I'd post...

  1. 616 Posts.
    Even though this is primarily for our market, I thought I'd post some German stuff:

    Namely the German term structure of interest rates, term spread and the DAX.

    First up, two views of their structure (since '97):
    DANGER term structure.png
    Another perspective:
    DANGER term structure other.png
    And now the Term spread Vs. the DAX:

    DANGER.png

    *left axis last graph is term spread in % (difference b/w 10 yr and 6 month bond yields)

    Conventional Bond theory may not stand here due to ECB purchases of S̶h̶e̶e̶t̶ absolutely glorious assets from Financial instos (ironically first up they're buying German paper).

    The above shows something that I believe is very important:  That term spread need not actually hit rock bottom before a bear market begins.  Term spread doesn't have to be negative for the party to end.

    Conclusion:  I have NFI, but if i had to guess (with the aid danger mouse), the equities party is nearing its limit.

    dangermouse.jpg
 
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