There's nothing positive to be said about it. What's happening now is foreigners are looking to buy higher yielding paper, including agency and corporate debt.

Those that thought the central-bank buying would not be there for the auction have been proven wrong.

The bond market is collapsing. What goes up must come down.

Bonds are well bid on the theory that this will slow down the U.S. economy,

The three-year was a great auction...but it just doesn't matter that much to the market. The next key piece of information really is how the Fed phrases the statement (on the U.S. economy, which it habitually makes after policy meetings).

The weakness in the stock market, the fact that the charts and trends look so bad, is going to keep an underlying bid under the bond market.