BIS Warns of Treasury Trade Meltdown.
From Greg M
Lions and friends…
The so-called "central bank for central banks" is the latest institution to flag hedge funds' Treasury trading bonanza as a threat to market stability.
The Bank for International Settlements warned in its latest quarterly report on Monday that "the current build-up of leveraged short positions in US Treasury futures is a financial vulnerability worth monitoring because of the margin spirals it could potentially trigger."
TO SUMMERIZE: Hedge funds are taking up more and larger leveraged bets that the debt market will melt down.
The BIS joins the FSB, SEC, and Federal Reserve in raising alarms in recent months.
It’s all falling into place just like we’ve been talking about.
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