Conservative Economics

Advertisement

Recent Tweets

Follow capflowwatch on Twitter
Page 5 of 512345
Category: US Bonds
Q3 2005

Life insurers still favor bonds

Life Insurers' Assets

Life insurance companies invest pension and life insurance reserves primarily in bonds, according to Federal Reserve Flow of Funds Table F 117 for Q3 2005. Although favoring agency securities and treasuries in 2002, life insurers quickly returned to their traditional investment behavior of buying mostly corporate bonds.

Since 1997, pension funds have become the principal business of life insurance companies, as indicated by the relative size of life insurance and pension funds reserves.

US Bond Market

Rate sensitivity and bond issuance

Interconnected markets

This article describes the factors that influence the four primary US bond markets: Treasuries, Agencies, Municipals, and Corporates.

The analysis indicates that a high percentage of the supply side of the bond market is opportunistic and sensitive to interest rates, which explains why long-term interest rates have been relatively stable, despite increasing demand.

This analysis also suggests that should the flow of funds from the trade deficit suddenly dry up, the first impact would be a rapid reduction in the size of the residential mortgage market, rather than a sharp increase in interest rates.

US Bond Market 1995-2004

Bond demand exceeds supply for a decade

Supply & Demand: US Bonds

Over the decade, 1995-2004, the demand for US bonds of all types has surpassed new bond issues in eight of the last ten years. This is the reason that bond prices have held firm, even in 2003, when net new issues reached almost $1.8 trillion.

In most years, buyers had to go to the secondary market to get all the bonds they wanted. On the demand side, steady buying pressure, accounting for about two-thirds of the market, has come from foreign investors, insurance companies, federal, state, and local governments, and banks and savings institutions — each acting for difference reasons.

Page 5 of 512345

Featured articles on inside pages

Stock buybacks

Stock buybacks dry up

Since 1982, US equities have been driven upwards by stock buybacks. Federal Reserve statistics show corresponding sales of stocks as executives exercised options to take advantage of manipulated prices. More ...

Securities Analysis

Mark-to-market nonsense

Banks, by their nature, are insolvent, requiring government guarantees of their liabilities to protect against bank runs. Over the last fifty years, the percentage of bank liabilities guaranteed by the government has fallen considerably, while banks, free from the shackles of the Glass-Steagall Act, have become increasingly complex.
More ...

US Politics

Why Congress won't kill ACORN

Closely connected with President Obama, the ACORN group of "community organizers" has drawn censure from the Democrat-controlled Congress as a result of investigative reporting by James O'Keefe and Hannah Giles. More ...

US equities

Stocks surge on spurious earnings

In Q1 2009, stock buybacks came back, driving up equity prices and sparking a rally by dominating a thin market. These equity repurchases were financed from depreciation reserves and bond issues. More ...

US Bonds

Bond demand exceeds supply for a decade

Over the decade, 1995-2004, the demand for US bonds of all types has surpassed new bond issues in eight of the last ten years. This is the reason that bond prices have held firm, even in 2003, when net new issues reached almost $1.8 trillion. More ...

World Economy

Signs of US losing its groove?

Thirty years ago, US income from abroad was more than double the amount of income that the US paid to the rest of the world. This year, or the next, this foreign income surplus may disappear forever. Is the US 'losing its groove'? More ...

Custom Search

Subscribe / Follow

Subscribe via RSS

Site navigation

Capital Flow Watch has hundreds of articles on economics and investments.

Articles have excerpts on the front pages, and on tag, category, search and archive pages.


Review capital-flow-watch.net on alexa.com

» Blog Guide

Excerpts by Category

Article Calendar

May 2012
MTWTFSS
« Sep  
 123456
78910111213
14151617181920
21222324252627
28293031 

Stock Quotes

Indu0.00  chartN/A
NASDAQ2847.21  chart +0.00%
S&P 5001315.99  chart +1.60%

Ftse 1005354.62  chart +0.95%
Dax6389.05  chart +0.92%
Cac 403056.22  chart +0.96%

Nikkei 2258729.29  chart +1.10%
Hang Seng Index19039.15  chart +0.62%
Sti2826.22  chart +1.29%

Eur To Usd1.2805  chartN/A
Usd To Jpy79.54  chartN/A
Gbp To Usd1.5842  chartN/A

1969-12-31 19:00