John Canavan Quotations

If yields are rising over there, they provide a better investing opportunity.

(Jobless) claims nobody is going to care about, housing completions nobody is going to care about, chain store sales people might eye a little bit,

It gets the refunding off on the right foot, but it's still difficult to draw conclusions about how well the five- and 10-year note auctions will do based on the three-year auction.

Over the short term Treasuries yields will head higher and prices lower based on the fact that economic damage from this hurricane is not as great as the worst fears had priced in.

The announcement today is just a small part of what's going on. We have been seeing a good and steady supply of issuance, and that's going to spook people a little bit from a supply perspective.

You have seen a pretty significant rise in open interest in the Treasury futures market since the middle of last month as prices have declined, suggesting a pretty substantial short base out there, so we've held our footing so far this week.

We're looking at a Fed that's going to tighten in March. There's a clear suggestion we're going to see further declines in the two-year note going forward even if it's not in the next week or so.

Yes, the market developed a fear that employment would be stronger than it turned out to be, but it was still a pretty solid number, above economists' consensus forecast, so in general you're looking at recent economic numbers that have bond traders a little bit concerned.

What really drove the two-year to the high yield of the day was the two-year note auction, and the Beige Book didn't do anything to help.

At the long end, inflation remains remarkably tame because the Fed has been raising rates for an extended period of time.

Eliminate patronage and wasteful spending. Don't ask taxpayers to dig deeper into their pockets when some county employees, some venders and some suppliers have Joel in their back pocket.

Is the dollar importing inflation pressures? I think it remains to be seen.

It was a little stronger than expected, but the sentiment data really hasn't been a major issue here. We're really still reacting to the payroll data.

The sell-off has been sharp but not extreme. It did push the bond above 5 percent and that is going to be the psychological story taken away from all of this.

The story of the week has been the inverted yield curve. It's tough to read too much into the inversion. We may be more firmly inverted tomorrow after the psychological factor sets in. We can have an inverted curve and have it not lead to a recession. It depends on how much the curve becomes inverted and how long it remains there until we can talk about a recession.

The spread supply had been a factor weighing on the Treasury market and when the 10-year TIPS auction didn't go terribly well, that compounded the issue.

Although the overall number on GDP was very strong, it does appear that consumer spending is slowing a bit.

There's a remarkable respect for the Federal Reserve and their ability to fight inflation, and because of that it's going to be difficult to see any major near-term rise in long-term rates,

There's been a continued series of hawkish comments from the Fed, and there's supply pressure with today's five-year auction. All of this is going to put downward pressure on Treasury prices.

It's still a hefty amount of supply and there will be pressure on the market.

Stocks were also under pressure and that helped out a little.

The auction went quite well. There was good interest from indirect bidders,

That just adds to everything that's going on Friday, so we're just stuck following oil and stocks until then.

The Fed's keeping rates on hold is a continual plus for the front end and the lack of inflation is what's keeping long rates low.

Initially we turned a little lower after the auction results, but in the end we turned a little higher. It just seems as if the market has been able to recover partially after the losses of the last two days.

The June trade deficit was larger than expected which would suggest -- barring any other factors -- a small downward revision to second-quarter GDP growth.

The flattening move of the curve has been accelerating. There was some substantial buying of the new 30-year bond and now we're seeing a reversal of that as recent interest has waned. This has caused a quick reversal of the inversion.

The economic data were mixed, but then we got some pre-weekend short-covering and maybe some minor month-end buying.

The market is in a range trade and that situation is only getting more pronounced as we near the end of the year.