Greece's chief export these days is red herring.  More of them hit the market overnight as Tsipras allegedly sent a letter saying he agreed to almost all of the conditions from EU creditors.  There was some speculation that this could lead to the referendum being canceled and a deal being worked out.  Naturally, German Bund yields spiked on the news.  US Treasuries followed halfheartedly. 

Later in the morning, the same person (Tsipras, Greece's Prime Minister) virtually lambasted all aspects of all deal-making with the EU, saying that Greece is willing to negotiate but that Europe is blackmailing every single Greek citizen.  It was truly a pathetic display of double-talk, and something that has now resulted in the highest-ranking Eurozone officials running out of patience.  Shortly thereafter, the head of the Eurogroup said there is little chance of progress after that speech.

You would think that the downgraded prospects for a near-term agreement would have helped bond markets recover more.  Indeed the bounce back is evident, but it barely makes a dent in the overall losses.  This is perfectly in line with our ongoing conversation about Greece being a brush-stroke in the bigger picture.  Markets are more concerned with NFP positioning, strong data this morning, and the ongoing trend leading toward higher rates in 2015.  They've been trading that trend all year, and while Monday brought a glimmer of hope, it didn't challenge that trend.  At this point, NFP would have to utterly tank for that assessment to change.