Archive for August, 2008

Corporate Bonds

Tuesday, August 19th, 2008

The corporate bond market continues to operate in financial limbo. Deleveraging and fear has reduced dealer appetites to trade secondary paper and it is difficult to trade anything but large liquid and recently issued names.The new issue market shut down yesterday with the histrionics surrounding FNMA and Freddie Mac chasing ...

Money Markets

Tuesday, August 19th, 2008

I spoke with a money market trader who has been kind enough to grace these pages at times of financial stress over the course of the rolling financial crisis.He notes that the market is stressed and fragile. Participants are poised for some sort of crack up and trade accordingly. They ...

Corporate Bonds

Tuesday, August 19th, 2008

The IG 10 is 142 which makes it about 3 basis points wider than the previous close. The new American Express deal which priced Friday T+425 and + 90 to comps is 420/415/. That is approximately where it closed late yesterday.

Fisher Speech

Tuesday, August 19th, 2008

Federal Reserve Bank of Dallas President spoke before a group in Colorado this morning. My first comment is that his speech is very refreshing and is uncharacteristically (for a declamation By a Fed policy maker) filled with wit, humor and some pungent metaphors.He expects growth in the second half of ...

MBS

Tuesday, August 19th, 2008

There is a dearth of buyers in MBS market and spreads are leaking wider as we speak. At the current time paper is 3 1/2 ticks wider to swaps. The FNMA 6s trade around 100. A paid up subscriber and good friend notes that last August 6s were trading at 101. ...

FNMA and Freddie Mac CDS

Tuesday, August 19th, 2008

CDS on FNMA and Freddie quoted recently 345/355. That is about 40 basis points cheaper than previous close.

Overnight Flow

Tuesday, August 19th, 2008

Prop desk buyers of 5 years. Bank sellers of 10 years. Hedge Fund sellers of 5 years. Asset manager selling 2 years.

Agency Open:Sloppy and Weak

Tuesday, August 19th, 2008

Benchmark agency spreads are wider by about 3 basis points across the curve this morning. This is the senior paper which has been "rescued'.Subordinated paper, the status of which is indeterminate, took a battering yesterday and is opening to another round of weakness today. I do not have Bloomberg or ...

Opening Comments August 19 2008

Tuesday, August 19th, 2008

Prices of Treasury coupon securities have posted modest gains in overseas trading. Despite the modest nature of the gains fear is still ascendant and motivates trading. The overnight press is replete with stories about stress in the Libor funding markets and about the growing angst over the status of FNMA ...

ZEW

Tuesday, August 19th, 2008

The ZEW indicator of economic sentiment for Germany unexpectedly improved by 8 points in August and comes in at -55.5 after registering at -63.9 in July. The report stated that recent declines in the Euro and the price of oil have reduced fears of recession. However,the current conditions index reflects the ...