Wall Street wants details. Treasuries are in love with Geithner:
Treasuries rose, pushing yields on 10-year notes down the most in almost two months, on speculation a U.S. plan to rescue the banking system will prove inadequate, boosting demand for the safety of government debt.Salon:
U.S. securities gained as the Treasury’s sale of a record $32 billion of three-year notes drew greater demand than forecast. Treasury Secretary Timothy Geithner pledged government financing that may grow to as much as $2 trillion.
“The Geithner speech is short on details and long on rhetoric,” said Maxwell Bublitz, who oversees $3.5 billion in bonds as chief strategist at San Francisco-based SCM Advisors LLC. “In a word, it is weak.”
The yield on the 10-year note tumbled 14 basis points, or 0.14 percentage point, the most since Dec. 16, to 2.85 percent at 3:12 p.m. in New York, according to BGCantor Market Data. The price of the 3.75 percent security maturing in November 2018 climbed 1 6/32, or $11.88 per $1,000 face amount, to 107 18/32. Read more at Bloomberg.
But I don't think that's why the market is so glum. Geithner started out strong, with a clear description of the plight we're in, and a clear explanation of why government needed to take swift and strong action. But, once again, the speech was short on details -- and no more so than on the critical question of how the government will address the problem of dealing with the toxic assets that have effectively rendered large portions of the nation's financial system insolvent.
If there was a moment during the speech when investor sentiment crystallized, it came when Geithner announced that "we are exploring a range of different structures" to deal with precisely that issue.
