Tuesday, April 21, 2009

Bonds -- Corporate Baa Versus 10 Year Treasury Yield and Spread (Graph)


The spread between Corporate Baa and Treasury bonds remains wide. The risk premium evidences the considerable nervousness in the market place. Action by the Treasury and Federal Reserve are keeping treasury yields artificially low. I am expecting yields across all quality preferences to continue to rise.

In 2007, the spread was running around 175 basis point. It is now in the 550 basis points area.

Corporate Baa Versus 10 Year Treasury
Corporate Baa--blue line. 10 Year Treasury--red line.
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Bob DeMarco is a citizen journalist and twenty year Wall Street veteran. Bob has written more than 500 articles with more than 11,000 links to his work on the Internet. Content from All American Investor has been syndicated on Reuters, the Wall Street Journal, Fox News, Pluck, Blog Critics, and a growing list of newspaper websites. Bob is actively seeking syndication and writing assignments.


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