MBS RECAP: With Sippy Birds on Sell Buttons, Bond Traders Left Early

Posted To: MBS Commentary

You’re familiar with the sippy bird (or ” drinking bird “)? For years, these little birds have been offering traders the ability to get out of the office early with no one noticing. Conditions have to be just right though. Specifically, it has to be a day like today when everyone is interested in repeatedly pressing the “SELL” button in bond markets. It wasn’t a foregone conclusion that today would be a great day for such repetitive selling, but it quickly became clear as the afternoon hours rolled in. What can we blame this on? In my view, there was actually a bit of realization among traders about the challenges presented by next week’s condensed auction schedule (Treasury crammed the normal Tue/Wed/Thu auction cycle into the first 2 days of the week, with…(read more)

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