The 10 year is selling off today:
I have been keeping a close eye on treasuries today to look for signs of the European debt contagion spreading over here to the US. I find the selloff today in treasuries to be pretty ominous considering the fact that stocks are down triple digits as I type.
Remember: We are selling massive amounts of treasury debt next week.
The risk of a global sovereign bond panic is possible if these auctions don't do well IMO. Let's get real: Our debt to GDP ratio is really no better than Greece or Portugal's. To think "it's different over here" is akin a realtor telling you that "real estate always goes up!".
The vigilantes could easily do the same thing to our bonds over here. All hell could break loose if we see bad BTC's. Focus carefully on the longer end bond auctions next week. Those should be a very tough sell following the chaos in the European debt markets that we saw in the past week or so across the pond
To be fair, treasuries have soared in the last several days so we were due for a pullback.
Gold and silver are also soaring today which could be a signal that people are looking for alternatives to US bonds with their "flight to safety" trades.
Disclosure: No new positions at the time of publication but very tempted to short T-bills at these levels.