Comments on: And so tightening begins? http://blogs.reuters.com/rolfe-winkler/2010/02/19/and-so-tightening-begins/ Option ARMageddon Thu, 09 Aug 2012 01:58:02 +0000 hourly 1 http://wordpress.org/?v=3.4.2 By: BrianOmdahl http://blogs.reuters.com/rolfe-winkler/2010/02/19/and-so-tightening-begins/comment-page-1/#comment-5156 BrianOmdahl Fri, 19 Feb 2010 16:55:14 +0000 http://blogs.reuters.com/rolfe-winkler/?p=5399#comment-5156 Hi Rolfe Are you concerned with the $640 Trillion dollar derivates market? I just don’t see how the American Economy will escape that 600 LB gorilla. It’s like everyone thinks it’s not there or they pretend it’s not. Hi Rolfe
Are you concerned with the $640 Trillion dollar derivates market?
I just don’t see how the American Economy will escape that 600 LB gorilla.
It’s like everyone thinks it’s not there or they pretend it’s not.

]]> By: Matt-Chicago http://blogs.reuters.com/rolfe-winkler/2010/02/19/and-so-tightening-begins/comment-page-1/#comment-5155 Matt-Chicago Fri, 19 Feb 2010 16:51:16 +0000 http://blogs.reuters.com/rolfe-winkler/?p=5399#comment-5155 Rolfe, I am somewhat of an amateur at this. What kind of recession would be necessary in order to de-lever? Also, regarding the federal government and the rolling over of debt, once the dollar crisis hits I imagine that treasury rates will have to increase substantially in order to retain demand for our debt. How can the US government continue to make interest payments on treasury bills once our yield rates rise to say 10-15%? Those kind of interest payments on trillions of dollars of debt would make up a huge chuck of the fiscal budget. I also imagine the high yield rates on treasuries will be mirrored at the discount window, making it even harder for businesses (our economy) to finance growth. Matt Rolfe,

I am somewhat of an amateur at this. What kind of recession would be necessary in order to de-lever?

Also, regarding the federal government and the rolling over of debt, once the dollar crisis hits I imagine that treasury rates will have to increase substantially in order to retain demand for our debt. How can the US government continue to make interest payments on treasury bills once our yield rates rise to say 10-15%? Those kind of interest payments on trillions of dollars of debt would make up a huge chuck of the fiscal budget.

I also imagine the high yield rates on treasuries will be mirrored at the discount window, making it even harder for businesses (our economy) to finance growth.

Matt

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