Archive for December, 2013
Thursday, December 12th, 2013
The robust retail sales report has participants thinking taper and the yield curve is contorting as we speak. The US Treasury will sell $13 billion Long Bonds at 100PM but the bond is the best performer on the list. The 10 year /30 year spread has powered through 101 and ...
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Thursday, December 12th, 2013
I composed a post last night which commented on and elucidated the WSJ story on the use of a new tool by the Open Market Desk called reverse repo. I wanted to add some thoughts and some history.
When I worked at the Desk in the 1979 through 1981 period the ...
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Thursday, December 12th, 2013
Via mark Chandler at Brown Brothers Harriman:
Ministry of Finance data shows Japanese investors continuing to buy foreign bonds (JPY413 bln), with about a third being financed by the sale of foreign equities and bills. They have been net buyers of foreign bonds for the last nine weeks. Foreign investors continue ...
Posted in Uncategorized | Comments Off on Yen Capital Flows
Thursday, December 12th, 2013
Prices of Treasury coupon securities have made a feeble attempt to mimic a moribund feline dropped from on high. Treasury prices and the aforementioned feline have each experienced very modest bounces. The yield on the 10 year note is about a basis point lower at 2.845. As I peruse the ...
Posted in Uncategorized | Comments Off on December 12 2013 Opening
Wednesday, December 11th, 2013
Victoria McGrane and Jon Hilsenrath penned a piece about a new tool for controlling short term interest rates. I do not think it is new;it is just a wrinkle on a tool very common when I worked at the Open Market Desk. In those days we called these transactions "matched ...
Posted in Uncategorized | Comments Off on Back to the Future with Reverse Repo
Wednesday, December 11th, 2013
A second term President faces a tough slog when voters exercise the Franchise in the midterm election in the sixth year of a President's term. John Harwood at the NYTimes provides an excellent recap of those situations since WW2.
The budget deal does not include an extension of benefits for many ...
Posted in Uncategorized | Comments Off on Miscellany
Wednesday, December 11th, 2013
Swap spreads are dramatically unchanged today. There has been some movement but quite minimal. The 3 year spread is narrower but that just reflects the roll into the new 3 year note. If I had to synthesize several comments from traders and sales people it is that the year is ...
Posted in Uncategorized | Comments Off on Swaps and a Little MBS
Wednesday, December 11th, 2013
In a little more than an hour Jack Lew and his acolytes and attendants will offer $21 billion 10 year notes on behalf of the Unites States payers. I just made the rounds of some sell side types and the conventional wisdom holds that the auction will go well. The ...
Posted in Uncategorized | Comments Off on Ten Year Auction
Wednesday, December 11th, 2013
Corporate bond calendar this far today courtesy of the good people at Bloomberg First Word.
12-11-13
Devon Energy Corporation B'Mark Baa1/BBB+ 3/4 part
2 yr frn, 3 yr fxd and/or frn, 5 yr fxd
ipt 2 yr frn +50 area
3 yr fxd +70 area
frn +low 60's
5 yr fxd +95 area
Time Warner Inc. 1 bln ...
Posted in Uncategorized | Comments Off on Corporate Calendar
Wednesday, December 11th, 2013
The Treasury market is under some pressure this morning. I think that it is mostly dealers looking to metaphorically shoot taxpayers in the toe for the impending duration drop in 10s and 30s. As I noted early this morning there is no concession in the 10 year reopening scheduled for ...
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