What Does Today's Rally Mean For The Bigger Picture? Bonds began the day in flat to slightly weaker territory, but that didn't last long.  A gigantic wave of selling in equities markets grew to tsunami-like proportions as the day progressed.  Unlike many other examples of days where stocks fall 3-4% by noon, there was no major attempt to recover before the 4pm NYSE close.  It was very clear throughout the day that the progressively larger selling spree in stocks was responsible for the progressively larger rally in bonds.  With oil prices following the same path, "global growth concern" was the topic of the day.  With all this being the case, today's bond rally, in and of itself, means very little for the bigger picture because its existence is predicated on ongoing stock losses.   Econ Data / Events Fed MBS Buying  10am, 11:30am, 1pm Housing Starts 1.724 vs 1.765m f'cast, 1.728m prev Building Permits 1.819 vs 1.812m f'cast, 1.879m prev Market Movement Recap 08:38 AM Initially stronger overnight before losing ground in the run up to domestic session.  Volatile little swings in early trading with 10yr currently down a hair at 2.991.  MBS down 6 ticks (.19) at 98-26 (98.81). 11:16 AM Solid gains now as stocks and oil swoon.  10yr down 7bps at 2.926 and MBS turning green, now up an eighth at 99-04 (99.125) 02:08 PM Flight to safety continues with stocks down almost 4% and 10yr yields down more than 10bps to 2.888%.  MBS are up 3/8ths, underperforming due to their shorter duration (and the fact that the yield curve is flattening today.