The DC Today - Thursday, October 5, 2023
The Dividend Cafe
The Dividend Cafe - The Bahnsen Group
4.9 • 572 Ratings
🗓️ 5 October 2023
⏱️ 6 minutes
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Summary
Today's Post - https://bahnsen.co/3F8Luji
More or less, there is one market movement right now, even if it has three parts. Bond yields and the dollar are in the same direction; stocks are in the opposite direction. Those three in those respective relationships are all part of one story, not three different stories.
In a nutshell, I remain convinced that the story has become one of quantitative tightening. The Fed is a seller (sort of) of Treasuries, not a buyer (meaning they are not rolling over matured bonds). Global central banks are buying less to support their own currencies. And that leaves individuals and economic buyers who buy at good yields but not lower yields.
On Capitol Hill, the race for the new speaker is setting up to be a real circus. I know, you are shocked.
Gasoline is down over -20% in the last three weeks!
Mary Daly of the San Francisco Fed said in a speech today that, wait for it, holding rates where they are is also restrictive monetary policy! Hmmmm, you don’t say.
Other than that, it was an uneventful day, and the intra-day swing was only -225 points (the chart visually looks more violent) – all in a flat day.
Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com
Transcript
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| 0:00.0 | Welcome to the DC Today, your daily market synopsis of the Dividing Cafe, brought to you every Monday through Thursday to bring you up-to-date information and perspective on financial markets. |
| 0:14.6 | Well, hello, welcome to the Thursday edition of the DC Today. It has been an odd day in markets in the sense that it looks really |
| 0:23.0 | boring. The Dow was dead flat. I think it was down 10 points. The S&P was down 12 basis points, |
| 0:29.0 | not much. Nasdaq down 13 basis points. The 10-year bond yield was dead flat, which is really why |
| 0:34.8 | stocks were flat. Actually, I think it was down one basis point, |
| 0:37.9 | which pushed bonds up a tiny, tiny bit. Oil was down another one and a something percent. |
| 0:44.3 | The Dow intraday was down 225 points, but the chart looked real bad. I got it dropped a lot |
| 0:52.2 | and came all the way back, but, you know, with the kind of volatility we've been having, $2.25 still not much. |
| 0:57.7 | Consumer staples were almost all of the downside. |
| 1:00.5 | Real estate was the biggest gainer today. |
| 1:03.4 | It feels like we're near a washout of capitulation. |
| 1:06.9 | Some of the consumer staples. |
| 1:08.6 | We were in the market actively today on that front. So you do have |
| 1:13.1 | just kind of a very similar story. It's getting to be a broken record. It's going to stay. |
| 1:19.4 | So I don't mind just repeating it every day, but I beg your pardon if it's annoying. |
| 1:25.8 | The dollar bond yields and then it's annoying. The dollar, bond yields, and then inversely, stocks. Those are |
| 1:31.9 | three different things, but it's really all one thing. Right now, bond yields up, dollar up, |
| 1:38.3 | stocks down is one monolithic experience, or bond yields down, dollar down, stocks up. |
| 1:45.0 | That's pretty much where we are. |
| 1:48.0 | There's not going to be a lot of daylight for a little while, in my opinion, |
| 1:52.0 | between the dollar and bond yields and between dollar bond yields |
| 1:55.0 | and the inverse movement of equities. |
... |
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