August was nice.  September is mean... at least if you're a bond.

Investors wanted you in August when it was still unclear whether or not Turkey was going to be a big deal for the global financial system, whether the trade war would spiral out of control, or whether the EU was seeing a disturbing shift in economic data.

What a difference a few weeks makes!  Europe has reversed course, Turkey is "fixed," we've had some very strong econ data, and trade war risks are roughly unchanged (which is positive in and of itself, because it means they're not blossoming into the dire situations feared by some).

Bottom line, no one wants to pay very much for bonds right now.  A moderately big miss in Retail Sales isn't even enough for a token Friday morning rally.  Paradoxically though, a big beat in Consumer Sentiment didn't cause any more damage at 10am.  That suggests ulterior motives behind the scenes. 

We've often wondered aloud if tax deadlines have a random effect on bonds due to retirement account funding deadlines and the fact that retirement funds are some of the biggest bond market players.  If that's the case, things would start looking different as early as next Tuesday (corporate tax deadline Monday).  Maybe just wishful thinking, but with 10yr yields at 3%, we'll take whatever we can get.