Courtesy of Pam Martens
Yield on Two-Year Treasury (Green) Versus Yield on 10-Year Treasury (Orange)
By Pam Martens and Russ Martens: January 22, 2018
President Donald Trump’s persistence on his Twitter page in touting how well the stock market is doing is distracting investors from a scary, negative indicator for stocks – rising yields on U.S. Treasury securities.
Since September of last year, yields have been on a steady and sharp upward trajectory, reminiscent of standing at the base of a mogul run in Colorado and craning one’s neck toward the summit. The complacency the stock market is showing toward the fierce rise in yields may also turn out to be a dangerous, slippery slope for those heavily weighted in stocks.
On November 9, 2016 the two-year U.S. Treasury Note closed the day with a yield of 0.8942 percent. One year later, on November 9, 2017, it finished its trading session with a yield of 1.64 percent. As of 6:50 a.m. this morning, the yield on the two-year Treasury stands at 2.06 percent – nosebleed territory in terms of its rapid ascent.
Likewise, the benchmark 10-year U.S. Treasury Note has moved from a yield of 2.06 percent on November 9, 2016 to 2.65 percent this morning, getting close to the 3 percent level where yield buyers start to pay close attention.
…
