Archive for July, 2008

Mortgages

Friday, July 18th, 2008

The carnage in the MBS market is unabated. Mortgages are finishing the day about 8 ticks wider to Treasuries.One veteran MBS trader who's writing I occasionally peruse noted that the selling this week was as significant this week as it was last March when the sarcophagus of Bear Stearns was being ...

Corporate Bonds

Friday, July 18th, 2008

Corporate bonds are tighter by about 2 basis points when viewed through the lens of the IG 10. The index is currently wrapped around 138. The new issuance calendar was closed today.Spreads remain wide and rates are rising. That is not an ideal climate for issuance. One syndicate desk trader ...

Update on the Friday Rout

Friday, July 18th, 2008

Benchmark treasury coupon yields are rising sharply today. Several factors have combined to result in a bit of a rout. Benchmark rates have jumped nearly 10 basis points in the 2 year through 10 year sector and 5 basis points for the Long BondThe bund market has taken a drubbing ...

Agency Market

Friday, July 18th, 2008

Pacific conditions reign in the Agency market after a roller coaster week. Spreads to Treasuries remain tighter by 2 basis points. One trader I sopke with commented that most traders had gotten their positions down to some desired level of risk and did not wish to add to that risk ...

More on the GSE Legislation

Friday, July 18th, 2008

I wrote twice yesterday about the draft proposal of the GSE rescue package which I had come across. The draft contained the egregious provision that spending on the rescue would not be subject to the debt ceiling. Bloomberg published a story last night which says that Representative Frank will not go ...

Agency Outperformance

Friday, July 18th, 2008

One dealer in a note points out the recent gains of Agency debt. Agencies gained 7 basis points against swaps yesterday. They are opening about 2 basis points better versus benchmark Treasury securities this morning.Freddie Mac priced a 2 year deal yesterday at T+88 and L minus 5.5. The issue ...

Some Treasury Market Flow

Friday, July 18th, 2008

Some overnight treasury flow:Hedge funds and banks buying 10s. Bank buying of 2s. Central Banks buying 5s and 10s.

SOme Opening Comments July 18 2008

Friday, July 18th, 2008

Prices of Treasury coupon securities have declined in overnight trading as market participants assess earnings reports troubled financial companies. In early evening trading the bad news dispensed by Merrill Lynch weighed on sentiment while this morning Citibank surprised with a less than expected loss.The yield on the 2 year note ...

Freddie Stock Sale

Friday, July 18th, 2008

The Wall Street Journal is reporting that Freddie Mac may try to use the rebound in its stock price the last two days as an opportunity to sell shares to investors other than an avuncular Potomac River based government official. The article suggests that the firm might try to raise $10 ...

GSE Bailout Redux

Thursday, July 17th, 2008

I posted this earlier and thought it an important and interesting story. Since I will be away from the nerve center of Across the Curve for several hours I am linking to the story and leaving it at the top of the list.  This is one of my first editorial ...