A Fleeting Failure to “Hit the Bid”
“Catch the bid” is a trader expression. It’s not specific to bonds. But in this case, when yields are rising, bond prices fall. When the bond price plateaus, it means they are stable — which the stock market loves. The issue right now is bonds are becoming disorderly, which “is like a rampaging elephant. It can go any which way and destroy everything.” As we alluded to yesterday, rising short-term yields are a harbinger for inflation in the economy. The spectre of inflation and an inverted yield curve are both suggesting the market is reaching a top.