Bonds - Dump them like it's 1994.

Yesterday morning TMM were somewhat relieved to find Spain and Italy the focus of attention as Friday's rip higher had us feeling like passengers that had drunkenly got off the last train home a few stations early, watching it continue on up the track leaving us in the cold with a long walk to catch up. We had been thinking that HY credit was to be the populist trigger for a wobble but we are happy for an assist from any hand.

But Europe? Well as TMM says- "There are two things in life you can be sure of - "Death" and "A peripheral European country tripping over the last step up out of the darkened cellar and smashing its nose on the concrete"". Spain and Italy? TMM thank you. But special thanks has to go to Rajoy for adding a new precedent to political get out clauses with his statement that all the information that has been published by the media "is untrue - except for some things". Bet Chris Huhne wishes he'd thought of that one.

But thanks also have to go to to the supporting cast of European technicals, a monster stop-loss post NFP towel-chuck, the odd ratings company being gunned down (just when they thought they'd got away over the horizon) and an army of extrapolationists and their straight lines (did you see how many calls to new extremes came out from various research houses over the weekend? NZD/USD parity?).

Overnight falls in Asia have confirmed the globalness of this pullback but the tussel between improving ecomomic data, Spain PMIs very good, and the new euro political news has seen Europe open to a rebound. But TMM think the anatomy of a wash out will naturally see the buy-the-dippers first appear before another down move takes them out too with a collective "urghh". So with that in mind TMM are today sell-the-ralliers thinking this dip has more to it.

However though the new paradigmers have gone temporarily quiet we don't think it will be long before the bond market are belting out their new favourite tune. We've been hearing more and more of it from various sources and it's based on Prince's "1999"



Dump 'em like it's 1994

Don't worry, I won't hurt you
I only want you to buy my bonds

I was dreamin' when I bought these
Forgive me as it goes astray
But when I woke up this mornin'
Coulda sworn it was judgment day
The sky was all purple,
There were yields rising everywhere,
Tryin' to run from bond destruction,
Just gimme a price that's fair.

Cuz' they say two thousand twelve bond QE party over,
Oops, through the floor.
So tonight I'm gonna sell 'em like it's 1994.

I was dreamin' when I bought these
Thinking Fed would buy and buy 'em fast.
But QE is just a party. QE parties weren't meant to last
Growth is all around us, my mind says prepare for flight
So if I gotta deal, I'm gonna sell my bonds tonight.

Yeah, they say two thousand twelve bond QE party over,
Oops, through the floor
So tonight I'm gonna sell 'em like it's 1994

Yeah
Lemme tell ya somethin'
If you didn't come to dump them.
Don't bother knockin on my door
I got some stocks in my pocket,
And baby they're ready to roar
Yeah, everybody's got some bonds,
Watch 'em all dive late today
But before I'll let that happen,
I'll have sold my lot anyway.

Oh, they say two thousand twelve bond QE party over,
Oops, through the floor,
Were runnin' out the door (tonight I'm gonna)
So tonight we gonna (dump 'em like it's 1994)
We gonna, oww

Say it one more time
Two thousand twelve bond QE party over,
Oops, through the floor,
Were runnin out the door (tonight I'm gonna)
So tonight we gonna (dump 'em like it's 1994)
We gonna, oww

Alright, it's 1994
You say it, 1994
1994
1994 don't stop, don't stop, say it one more time
Two thousand twelve bond QE party over,
Oops, through the floor,
Yeah, yeah (tonight Im gonna)
So tonight we gonna (dump 'em like it's 1994)
We gonna, oww

Yeah, 1994 (1994)
Don'tcha wanna go (1994)
Don'tcha wanna go (1994)
We should all sell anyway (1994)
I don't wanna loss,
I'd rather give all my bonds away (1994)
Listen to what I'm tryin to say
Everybody, everybody say dump 'em
Cmon now, u say sell 'em
That's right, everybody say (dump 'em)
Cant run from the revelation, no (dump 'em)
Sell em, watch the govies fall (dump 'em)
Tell me as your rates are rising, baby sell (dump 'em)
Telephones a-ringin, broker (dump 'em)
Cmon, cmon, you sell (dump 'em)
Everybody, (dump 'em )
Sell 'em down to the ground, sell (dump 'em )
(dump them )
Come on, take my bonds, baby (dump 'em)
That's right, and go long S+P (dump 'em )
(dump 'em )
That's right (dump 'em)
Got stocks 'n' shares in my pocket man and Bonds? (dump 'em )
Oh, they've dumped right through the floor (dump 'em)

Mommy, why is everybody selling bonds?
Mommy, why is everybody selling bonds?