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This is the forty-fourth video installment from Porkopolis Economics, covering macro and money, from the creator of the Crypto Voices podcast.
Contents
00:00 Intro
00:25 Bonds... and two charts!
00:50 How important is the bond market?
03:40 Importance of 10-year note
04:34 Components of a bond (Yield most important!)
06:14 YTM history of US Treasury 10-yr note
10:11 Bond price sensitivity chart
16:15 Price sensitivity of 10-yr note only
19:55 What happens when yields rise? Pain...
24:15 What happens when yields fall? Fun...
Here we look at the main reason why banks are struggling today, and in general: The prices of government bonds have fallen drastically in the last year, as bond yields (or interest rates) have risen. This is the main reason why banks like SVB and others are failing.
Remember, the price/value of bonds moves in the opposite direction of their yields/rates!
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Show content is not investment or financial advice in any way.