Archive for July, 2008

July 17th Closing Recap

Thursday, July 17th, 2008

I am writing early again today as I am visiting the big city two days in a row. It had been so long that I had been in midtown Manhattan yesterday that when I came up from the bowels of the earth at Penn Station and arrived on 8th Avenue ...

Agency Debt

Thursday, July 17th, 2008

The agency sector was a festive place and the gloom and doom of recent days has faded for now. Benchmark agency spreads are tighter by 4 basis points in the 2 year sector,5 basis pints in the 5 year sector and 6 basis points in the 10 year sector.Everybody loved ...

GSE Bailout Bill

Thursday, July 17th, 2008

According to draft legislation being debated on Capitol Hill, the Congress would grant sweeping authority to the Secretary of the Treasury to purchase obligations and securities of FNMA, Freddie Mac, as well as those of the Federal Home Loan System. It imposes no restrictions on the Secretary of the Treasury ...

The Ban on Short Selling

Thursday, July 17th, 2008

I have commented on this several times so I thought I would link to this excellent post from The Big Picture. It points out the logical inconsistencies of the plan to restrain short sellers.

Corporate Bonds

Thursday, July 17th, 2008

When I spoke with an old friend with whom I regularly converse regarding the state of the corporate bond market he had a great line. He said that the market was licking its wounds rather than opening new ones. Spreads as gauged by the IG 10 are unchanged. The flow of new issues ...

Upcoming Treasury Supply

Thursday, July 17th, 2008

The Treasury market is about to enter a period of relatively heavy supply. Today the serial debt issuer announces a 20 year TIP Bond auction which will be held this coming Tuesday. That will be in the vicinity of $9billion.On Monday the Treasury will announce the regular monthly offerings of ...

MBS Opening

Thursday, July 17th, 2008

Weak. That is how they are opening. MBS has weakened about 6 ticks versus Treasuries and about 5 ticks versus swaps. One trader describes originator selling and speculative deleveraging as the culprits.

FNMA FRE CDS

Thursday, July 17th, 2008

CDS on subordinated paper of the GSEs is opening 180/190.  CDS on senior debt is opening 43/48.

Overnight Flow In Treasury Securities

Thursday, July 17th, 2008

It was a night of two way flow in the benchmark issues: Central banks sell 5s and 10s but commercial banks counter that flow by buying the same issues. A bank sells 10s in favor of 30s. Hedge fund sells 10s. Bank buyer 30s.

JPM Earnings

Thursday, July 17th, 2008

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7bCCFA29E4-A6FA-4B64-9E3A-99DD50D95811%7d&siteid=yhoof2