I think you are the only finance KZreadr that can make a video about treasury yields and still make it very entertaining. Great work

@ThePlainBagel

7 ай бұрын

That might be the best compliment I've ever received, thank you!

@tanishqsagar3440

7 ай бұрын

@@ThePlainBagel You're a good teacher, Mr Bagel

@brandon1113

7 ай бұрын

exactly what he said, and understandable!! unbelievably appreciated!

@blongshanks77

7 ай бұрын

I agree. It’s good to hear a KZreadr who actually just gives facts, and not personal opinions disguised as facts.. I always appreciate his videos.

@INTERNERT

7 ай бұрын

same, subscribed

this channel that I watch for entertainment is getting dangerously close to sounding like my university corporate finance courses lol

@alvydagr8108

7 ай бұрын

I had to take a break from youtube when all my recommended videos were actual lectures 😩

@DominicGreene72

7 ай бұрын

@@Wealthwise_capitaloh c’mon, at least buy comment bots to have a fake conversation with each other like everyone else. This is just shameless

@mclaren720

7 ай бұрын

@@DominicGreene72😂😂😂😂 i usually don’t react to comments but you got me

@hahaboy211

7 ай бұрын

​@@Wealthwise_capitalget lost. Idiot.

@peeonthe3rdrail414

7 ай бұрын

@@Wealthwise_capital Worst bot ever.

I like hearing about sticking to my long term goals to weather the storm. That effectively translates to “don’t have to actually do anything”, appealing to my lazy nature.

@xiphoid2011

7 ай бұрын

Underrated comment. Don't try to time the market, just have a good diversified the portfolio and keep adding your monthly savings to it. I'm mid 40s now, been 90% stock in the 20s and 30s, 75/25% stocks/bonds since turning 40 has been doing quite well, even up 10% for 2023 despite August & September pullback. Folks, just build a proper portfolio and adjust the mix annually to rebalance the mix. That's all there is to it for non professional investors.

@JLchevz

7 ай бұрын

just don't do anything crazy and save some cash for a rainy day

@adam872

7 ай бұрын

@@xiphoid2011yep, that's exactly what I do.

@chuckbrown8344

7 ай бұрын

Sounds good but hard to digest when your TLT bond portfolio drops 50% with no light in sight.😂

@andrewferguson6901

7 ай бұрын

Market down? It's on sale! Market up? You made money!

Canadians explaining US markets to Americans, there’s something poetic about this.

@TC-td1vx

7 ай бұрын

Except that we are in no position to lecture anyone with Turdeau in the office.

@monkeyboy600

7 ай бұрын

Are there no American sources you can find? Maybe its a you problem

@skyfeelan

7 ай бұрын

most US financial youtuber is just a shill, I prefer watching plain bagel lol and I'm not even canadian or american

@ericschumaker5126

7 ай бұрын

Richard is a Chartered Financial Analyst, who just happens to live in Ontario (Toronto, I think). As an aspiring CPA, and CFE, I think he is one of the best sources of financial advice. That he is Canadian is a mere coincidence.

@MenAreSpeaking

3 ай бұрын

Canada doesn't have an economy, so what else is he going to talk about

I like facts even if they're "boring" so thank you

Economists have successfully predicted 13 of the last 6 recessions

@donaldclifford5763

6 ай бұрын

The key to predictions is to predict often.

Thanks for having the Basics section in there for those of us that are still learning! Really appreciate it

@selfawaretrashcan4594

7 ай бұрын

Second that!

Your narrative on such topics you assume to be "boring", is really what makes your videos interesting and informative to watch & stay till the end. Thanks as always Mr Bagel 👍🏻

@XiaojunMa

7 ай бұрын

Make it boring? Mission failed successfully!

This is an impressively clear and coherent explanation of Treasury dynamics.

I really appreciate you explaining these things in a way that makes sense

Thanks Richard for another down-to-earth detailed explanation. I am a big fan of your work.

I'm really glad I can get the full view from The Plain Bagel before I've even heard the breathless predictions. I'm not interested in the average finance channel's perspective. You provide what few channels can!

Always content of the highest caliber. Thanks again.

Great videos! I just have one nitpick with phrasing: When you say there's a "selloff" or money being "pulled out" of a certain asset class, it implies that the stock or bond market inflate or deflate like a balloon, with money being the air "pumped in" or "pulled out". As you know, for every seller there is a buyer.

One of the best videos I've ever watched explaining treasury bond yields! Kudos to you, you've made over 130k people better informed off of this.

That jingle at 1:40 makes you seem like a financial superhero "Captain Compliance! Calming fears with sound financial strategy and unsensationalized market analysis." Your channel is awesome dude! I show it to everyone who is trying to understand the economy and markets. Keep up the great work 😄

Would love a video on what the normalization of these interest rates may look like in the future.

@mastpg

7 ай бұрын

If they normalize, it would probably look like they start to normalize, then continue to normalize, then looking back we'd see that they normalized.

@mastpg

7 ай бұрын

@@Wealthwise_capital Would hope this is a joke, but it's not possible to tell anymore.

@DominicGreene72

7 ай бұрын

@@mastpg it’s not a joke, it’s a scam

@samsonsoturian6013

7 ай бұрын

Bug startups will become a thing of the past

@mastpg

7 ай бұрын

@@DominicGreene72 That's why I was hoping it was a joke. Wealthwise Capital sounds like a joke name.

I really appreciate and need the steady hand approach these videos provide. I’m new to the market and to receiving pay based on equity, so it can be panic inducing. These videos help keep it in perspective.

Superb job of keeping your enthusiasm under control. Kudos😅

Please take this as a positive Richard; when it comes to making real world economics boring and real you are the best !!

Thank you i finally understand inverted yield curves now❤

Thank you so much for presenting us such quality videos with clear information. Keep it up! :)

I get that the market may be a little freaking about the interest rates but, as I see it, we were all acclimated to very low interest rates. The rates right now are basically a norm. It increases innovation, gives everyone’s head a shake that a buy and throw away economy isn’t staying around. Maybe , just maybe , we all will have to make things that last and are fixable. If not, then we will just have to go without. It’s time we appreciate and respect what we covet and learn to make it last.

Thank you for this, as usual! ❤ from Malaysia!

Appreciate the analysis without sensationalising or trying to sell a narrative like many other finance channels.

Great video. Although there was nothing in here I didn't already know I thought you covered pretty much most of the points on the topic. I might add that sell offs could also be a rush to liquidity in consideration of a potential financial crisis. Cash is a position in itself.

Rising yields also signifies resource constraint in the economy. That is, the opportunity cost of government spending is higher. Unless you think the government spends money very efficiently, that means lower growth and productivity.

@Seth9809

7 ай бұрын

What are you even saying?

@samsonsoturian6013

7 ай бұрын

That's all else hold equal, but we all know that both low rates and the current high rates were largely artificial.

@mrados81

7 ай бұрын

Literally my thoughts exactly@@Seth9809

@tonioinverness

6 ай бұрын

​@@samsonsoturian6013 what does this mean? Do you mean the rates were made in a lab instead of grown organically using non-chemical fertilizers? All rates are set somewhere by someone. They're all "artificial" through and through.

ty mr bagel

This is an amazing explanation for everything going on right now. Congrats!!!

A great summary of the current state of the bond market, the various inputs that go into it and the stakeholders that stand to gain/lose from this. I have done a lot of research on the historic equity market (S&P500) moves during yield curve inversion. What was particularly interesting to me is that each and every uninversion of the 10-2y curve since 1978 (six times for their respective recessions) has signalled equity market weakness in the short term, with the average one year maximum drawdown (from the market peak) of about -22%, yet in two thirds of these cases, the market rebounded and posted average gains of ~8.5% in this timeframe. The initial uninversions also signaled more medium term weakness, with a stock market bottom being found 6-24 months post uninversion and an average drawdown from initial uninversion to the bottom of ~25%. I think risky asset prices have a fair way to increase yet, as indicated by the FED's stance on "higher for longer" and the hotter than expected labour conditions, but the uninversion will be a stark omen of things to come.

@augstinepalena5327

7 ай бұрын

Very true, but would that not create a very long window where the yield curve is continually inverted? We may see some crazy high rates as a result…

This is not boring; this is essential for future survival-----Bill from Pennsylvania

really informative! Thank you. Video request: How rapidly rising interest rates affect the housing market and the likelihood of of defaults. What default % could be absorbable and what % would "break" the housing market. Just a suggestion. Love the videos.

Wow I never thought there’s a beautiful explanation of this out there. Keep up the good work man

Hi thanks for the content. I think a video on the recent treasury quarterly funding plan and how it thinks when it chooses to spread its debt and borrowing across maturities would really be helpful. Another topic that viewers might find interesting is that are big banks hedged enough to weather unrealized losses after this bear steepening. Thank you.

Great video! Very informative Richard, thanks you.

Deleveraging cycles are painful, but usually also necessary to return to healthy growth in the real economy. Particularly in Canada, this process is long overdue imo

@LaSombraa

7 ай бұрын

Time to crash these overvalued assets (stocks, housing)

Don't say "sorry, that'd my child" That moment added such a human element to this otherwuse plain explanation of this bagel.

Very calm delivery. I look forward to coming back in a year to rewatch this to see if you or Peter Schiff was right.

Yay, now I know what to talk about in my business class

Awesome work. Thank you for making these videos

Keep up the good work!

Great content, great presentarion. High level. Thank you

Great video and very rational and balanced viewpoint.

As someone preparing for the CFA charter / student of Finance, your videos are super helpful to see the concepts play out IRL! Thank you Bagel, super nice video!

Love me some plain bagel. I tell my friends about your channel.

I like your videos like this. I think i need to watch it like 10 more times to grasp everything though

thanks for getting rid of my confusion! you are appreciated

I really like the way you reign in the overreacting online. Nuance is always important and easily lost

Decent video for an overt Canadian. 😉 That being said, I didn't notice any mention that much of US debt is short term and close to 1/4 of it ($7.6 TRILLION) will mature in the next 12 months.

You know a finance youtuber knows his shit if the conclusion of all of the content is "we don't know"

@pocok5000

7 ай бұрын

this was not sarcasm btw

Nice vid! I'm wondering what your thoughts are surrounding the idea that "the bond market is the most sophisticated market," specifically the sentiment that these are top-dog players with tons of inside info? e.g. One could argue the bond market saw the shutdowns coming. Obviously some subjectivity there but I think it's important to clarify the viability of this idea when talking about the inverted yield curve; essentially, inverted yield curve equals the guys with the most inside info know something bad is coming. Any truth to this perception?

@afr11235

7 ай бұрын

If the inversion were resolving because short term rates were declining, this would be a sign that market sentiment expects a recession and related cuts in the federal funds rate. What we are seeing instead is a growing realization that the economy is still running too hot to bring down inflation so long term yields are pricing in the reality that rates will be higher for longer.

Those "highly deflationary" bank crises seem to be backstopped with BTFD now, which is highly inflationary. RRP draining is upward pressure on rates as well. All this new financial engineering reminds me of the old.

This is a great explanation .... thank you

When bond yields rise company spending declines - think of the interest of the lender being their return on investment. The higher the yield the more money you take home. The decline in company spending will trigger the recession we’ve been hearing about - however debt is only half of the story. Companies gain revenues through sales of equity as well (stonks). Company assets = liabilities + equity. It’s impossible to predict what’ll happen but we can have a pretty good idea by gauging the signs.

Always great content

Very intensive discussion, thanks

This channel, The Money Guys, 2 Cents, and Patrick Boyle are the best financial KZreadrs by far. Great content!~

Would love a video on the hilarity of the anomolous 20yr yield compared to the 10yr and 30yr due to illiquidity and its history

Excellent video. Really helped me to understand!!!

Awesome educational video !

Great video, thanks Richard!

So sometimes the invert yield curve is followed by a recession. But what is something else that has happened in the past after a yield inverse? the economy just picking up steam again?

Love this video. Very educational

Great video Richard

Really nice channel. I work the last years at ECB as an economist but this big picture was not so obvious to me - though it should be.

I have never clicked on a video so fast

Thanks Richard!

More than just a plain bagel. Thank you

Hi Plain Bagel, Have you read the price of time? If so what are your thoughts on it? I believe longer term rates at this level will be better for the economy in the long run. This inflation now is from all this qe

I really appreciate this breakdown unlike the chaos noise of some other videos I’ve seen where they just induces fear and are headline grabbers.

Save Festivus, no bagel!

Your content is terrific

Bring back the animations with bagels and all that! These videos are awesome but hard to stay on top of. Or even some subtitles

"... and to make it boring." That's exactly why I signed up to this channel :D "Keep it simple & stupid." Some people and the media tend to blew things out of proportions, whereas in the world of finance and business, things aren't that extremely interesting or mind-blowing - complicated, can be, but never or rarely so dramatic as some people would like to see it. PS: I think your kid had a very fair point there xD

I get that as bond prices go down their yields go up to make them more attractive; by what mechanism does this yield actually get set? Is there some guru that decides day-by-day/hour-by-hour what the current yield is? Is it part of the auction, a sort of reverse dutch auction thing? Is there some algo based on recent sales that sets the yield? Also, how does this mechanism differ for Canada government bonds?

@sachindaham

7 ай бұрын

I have same question too actually. Is the yield determined by the yield of the bond that was last sold in the secondary market?

@Ultrajamz

7 ай бұрын

The fed rate, and also if nobody is buying the bonds they raise the yield until someone does, since they are sold at set price on primary market

@Tercel_Champion

7 ай бұрын

I buy bonds frequently. Almost everything is a manual limit order. Each day people log in and look at an order book to see the depth (all of the limit orders). There might be 5, 7, or 20 people selling and others buying. Then there is a price listed, number of bonds available, and minimum purchase. These get updated manually by sellers and buyers every couple of sales. A system called Trace updates upon the sale of the bond. People see that and manually change the price of any outstanding limit order if they want. The number of sellers, buyers, and number of bonds determines the price over time each day. Close price (at the end of the day) is usually the recorded price for the historical trend. If there are lots of sellers or few buyers, the price tends to fall.

@namlehai2737

7 ай бұрын

Your question is answered, in a very detailed manner, in Principles of Macroeconomics, Olivier Blanchard

Scary how much I agree with your point of view. I am invested in Stocks, Munis and annuity. Managed by Merrill Lynch and BAC. So I worry.

Can we talk about the bank term funding program? Valuing collateral at par seems like a massive subsidy. Am I wrong that any lender except the Fed would be demanding rates closer to that of unsecured debt for the portion of the loan collateralized by the difference between par and market price?

I wish you the best of luck on your kitchen remodeling!

Interesting that you cited Morning Brew. Probably the first time I've seen that.

Amazing video Richard

Watched the whole video, good information!! When you said “it’s my child” I deleted my previous comment

@gruesomebugbear9108

7 ай бұрын

今天不·今天·今天又被称为小姐姐的。在这里等你们回来吧。你是不是也是我们自己喜欢的人。是不是真的好吃又·在！……今天·。今天．．你的。是．你😂😂😂

Question Richard if I may ask, So it’s best to lock in now with high yielding bonds and follow the rate cut or rate hike? Love the Videos!!

Another important factor in the treasury market is the resolution of the debt ceiling issue. For many months the federal government funded itself through “extraordinary measures” like raiding federal employees’ pension funds. Now the victims of these gimmicks must be made whole, so the treasury is issuing a lot more debt than normal.

@ElGranDoTe1

7 ай бұрын

I had not heard of that thanks!

Can you do a video about the US housing market? Love your content!

Good explanation why does the 10 year affect the stock market?

Thanks

Can u dig deeper into why bonds are losing money as a whole? Do you mean old bonds ? Right now it’s a mix of new and old so the discount is high right? So are there more unprofitable bonds than profitable bonds in the market?

Could you do a video on why the Federal Reserve doesn't try changing the reserve requirement ratios to fight inflation? They've been 0% since March 2020, and raising them would clearly combat inflation by reducing cash supply, but it's never even brought up as an option.

@chronoshin8597

7 ай бұрын

Not many bank keep their ratio at 0% anyway. So any decision by FED to change the ratio would have minimal impact to the financial market.

Great video! I want to see how all this unfolds in the next 2 years.

Thanks!!!

So would it be safe to say that it is better to look at buying T-bills and maximizing the higher returns for shorter hold periods until the yield curve begins uninverting?

Good to know, thanks

Finally someone who actually explains what an inverted yield curve is rather than screaming "OMYGOD THE YIELD CURVE IS INVERTED WERE ALL SCREWED"

Good job thx

Thank you very much!

Amazing content!

Can you please make a video on how to protect 401k form eventual crash moving all into bonds? At least until we see clearer.

I would like an episode about why the US economy is not going into a recession such a increasing gov spending. higher demand for the US$ and equities worldwide and the cost of oil etc. That way we could be a little more optimistic about the US economy in comparison to other countries

@disguysn

7 ай бұрын

My guess is that we're still riding the wave of cheap debt from the previous years. Who knows when it will come crashing down?

@steviewonder417

7 ай бұрын

@@disguysnsurely couldn’t be the 100 billion per month we print through the gov security interest channel!

@lowwastehighmelanin

7 ай бұрын

Our economy is doo doo and you just gotta be ok with that.

@tadwiltman4875

7 ай бұрын

My guess... most of us who have homeowner and other longer-term debt are locked-in at a very low interest rate, so really not being affected much by rising rates. Wages going up help those who have that kind of debt as a dominant feature in their budget... even despite the current high-inflation environment

@Martcapt

7 ай бұрын

And I'd like a magical flying poney

Good explainer but I think you could’ve highlighted how unprecedented the current market action is. Rates have trended downwards for 30 years and are now rising faster than ever before. The risks are astronomical. We have to seriously consider the possibility the US government will not be able to fulfill its debt obligations without yield curve control, which could give inflation a second wind (see Japan).

So is now an ideal time to buy bonds and CDs?