Frontrunning: November 18

Zero Hedge

• Bloomberg censorship alert? Inititally this Bloomberg article had a quote by Mizhuho’s Hiromasa Nakamura saying “there will be a double-dip recession.” Subsequently any reference to the gentleman and the quote below was “editorialized.” Here is a snapshot of what the original Bloomberg article said (please google the bolded text):

Treasury three-month bill rates turned negative yesterday for the first
time since financial markets froze last year on concern that prices of
everything from stocks to commodities are too high given the outlook
for economic growth.

The global average government bond yield dropped to 2.20 percent as of
yesterday from 2.50 percent in August, according to the Merrill Lynch
Global Sovereign Broad Market Plus Index. Bill Gross, who runs the
world’s biggest bond fund at Pacific Investment Management Co., said
the “systemic risk” of new asset bubbles is rising with the Federal
Reserve keeping interest rates at record lows.

“There will be a double-dip recession,” said Hiromasa Nakamura, a
senior investor at Mizuho Asset Management Co. in Tokyo, which oversees
the equivalent of $21.4 billion and is part of Japan’s second-largest
bank. “The Federal Reserve’s low-interest-rate policy will continue for
a long time, maybe two years. Treasury yields will decline.”

The three-month bill rate was 0.005 percent as of 10:46 a.m. in Tokyo, according to data compiled by Bloomberg.

Rates turned negative on some bills maturing in January, according to
Sarah Sobeck, a Treasury trader at Jefferies & Co. one of 18
primary dealers that trade directly with the Fed.

Bill rates were negative last December for the first time since the
government began selling them in 1929 as investors sought to preserve
their principal following the collapse of Lehman Brothers Holdings Inc.

• Goldman stock holders miffed at bonuses (WSJ)
• White House rebuke: angry Democrats shut down vote (HuffPo)
• Fed makes monitoring bank capital foremost concern (Bloomberg)
• Risk fatigue sparks correction speculation (FT)
• Treasury yield plunge sends warning (Barrons)
• Trichet says not all measures to be needed in the future (Bloomberg)
• Krugman on AIG: the Big Squander (NYT)
• Why Krugman is wrong about the Yuan (Forbes) 
• Harvard poker pro says Texas Hold ‘Em can teach traders when to fold (Bloomberg)

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