Mike Perry, a loyal MR reader, sends me this:
The U.K. failed to find enough
buyers for 1.75 billion pounds ($2.55 billion) of bonds for the
first time in almost seven years as debt investors repudiated
Prime Minister Gordon Brown‘s plan to stem the worst economic
crisis in three decades.
Gilts slumped after the London-based Debt Management
Office, which manages bond auctions on behalf of the Treasury,
said investors bid for 1.63 billion pounds of the 40-year
securities. The last time the U.K. government was unable to
attract enough investors was in 2002 when it tried to sell 30-
year inflation-protected bonds. The yield on the 4.25 percent
gilt due 2049 rose 10 basis points to 4.55 percent.
I wouldn’t be so sure about your title:
NEW YORK (AP) — Stocks lost ground after a weak auction of U.S. government debt stirred worries about how easily Washington will be able to raise money to fund its economic rescue program.
Investors gave an unexpectedly cool response to a $24 billion auction of 5-year Treasury notes Wednesday, which also sent prices for Treasurys lower.
http://market-ticker.denninger.net/archives/899-Bond-Market-To-Bernanke-and-Obama-Fk-You.html
I’ve given this some thought. The issue may be a little more complex than it seems: have a look at http://www.knowingandmaking.com/2009/03/is-bad-news-for-treasury-good-for.html for some of the issues. In short, while it may be bad news for UK government finances in the short term, that doesn’t mean it’s bad for the economy (or indeed for the government) in general.
I’m sure Tyler’s title was sarcastic, but it was probably needlessly so. I don’t know of anyone who seriously believes there is no concern over demand, but I that doesn’t mean most of those same worries believe demand will simply collapse.
UK economics blog Stumbling and Mumbling had a good entry on it:
Fortunately, Treasuries with fiat currencies can simply spend without borrowing.
You can have a look at the new revolution coming from this debt debacle: http://www.youtube.com/watch?v=94lW6Y4tBXs&feature=haxa_popt00us00
“You have run out of our money!” from Daniel Hannan
It looks like the US is next.
majority default on debt , and its common in different countries , in this respect security management is must .
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