{"id":275069,"date":"2025-04-28T01:06:14","date_gmt":"2025-04-28T01:06:14","guid":{"rendered":"https:\/\/michigandigitalnews.com\/index.php\/2025\/04\/28\/safe-no-more-two-pictures\/"},"modified":"2025-06-25T17:08:44","modified_gmt":"2025-06-25T17:08:44","slug":"safe-no-more-two-pictures","status":"publish","type":"post","link":"https:\/\/michigandigitalnews.com\/index.php\/2025\/04\/28\/safe-no-more-two-pictures\/","title":{"rendered":"Safe No More? Two Pictures"},"content":{"rendered":"<p> [ad_1]<br \/>\n<\/p>\n<p>Prepping slides for macro, found these interesting correlations.<\/p>\n<p><span id=\"more-56516\"><\/span><\/p>\n<p>First, how the strength of the dollar correlates with the Treasury 10 year yield, daily 2015-23 April 2025.<\/p>\n<p><a href=\"https:\/\/econbrowser.com\/wp-content\/uploads\/2025\/04\/nomdollar_gs10.png\"><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone size-full wp-image-56517\" src=\"https:\/\/econbrowser.com\/wp-content\/uploads\/2025\/04\/nomdollar_gs10.png\" alt=\"\" width=\"590\" height=\"590\" \/><\/a><\/p>\n<p><em><strong>Figure 1:<\/strong> Nominal dollar index vs. basket of major country currencies (blue circles), and OLS fit (blue line), and observations for 4\/2\/2025-4\/15\/2025 (red circles). Source: Fed and Treasury via FRED, and author&#8217;s calculations.<\/em><\/p>\n<p>In the two weeks around Liberation Day, Treasury 10 year yields rose as the dollar fell (red circles in Figure 1).<\/p>\n<p>One obvious place to look for a loss in credibility is in credit ratings; however, those are notoriously sticky. I looked at credit default swap spreads, and was surprised, as I thought only in emerging market economies in crisis did I see noticeable movements &#8212; such as those since April 2, &#8220;Liberation Day&#8221;.<\/p>\n<p><a href=\"https:\/\/econbrowser.com\/wp-content\/uploads\/2025\/04\/cds_us_27apr25short1.png\"><img decoding=\"async\" class=\"alignnone size-full wp-image-56519\" src=\"https:\/\/econbrowser.com\/wp-content\/uploads\/2025\/04\/cds_us_27apr25short1.png\" alt=\"\" width=\"1200\" height=\"900\" \/><\/a><\/p>\n<p><em><strong>Source:<\/strong> worldgovernmentbonds.com, annotated by author.<\/em><\/p>\n<p>Large movements only in the context of the US. To quote:<\/p>\n<blockquote>\n<p>As of the latest update on\u00a027 Apr 2025 13:45\u00a0GMT+0, the\u00a0United States 5 Years\u00a0Credit Default Swap (CDS) value stands at\u00a052.25\u00a0basis points. This CDS value translates to an implied\u00a0probability of default\u00a0of\u00a00.87%, based on a presumed recovery rate of 40%.<\/p>\n<\/blockquote>\n<p>All I can say is, thanks Trump!<\/p>\n<p>&nbsp;<\/p>\n<p>[ad_2]<br \/>\n<br \/><a href=\"https:\/\/econbrowser.com\/archives\/2025\/04\/two-pictures-on-the-usd-as-safe-haven-asset\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>[ad_1] Prepping slides for macro, found these interesting correlations. First, how the strength of the dollar correlates with the Treasury 10 year yield, daily 2015-23<\/p>\n","protected":false},"author":1,"featured_media":275070,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[155],"tags":[],"_links":{"self":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts\/275069"}],"collection":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/comments?post=275069"}],"version-history":[{"count":0,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts\/275069\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/media\/275070"}],"wp:attachment":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/media?parent=275069"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/categories?post=275069"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/tags?post=275069"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}