Archive for January, 2014

Brazil

Friday, January 24th, 2014

Emerging markets have driven the trade the last several days. Brazil has been an island of relative equanimity amidst the storm but there is some data there this morning which might interest the market. Mark Chandler of Brown Brothers thinks that the calm in Brazil is fragile and he wrote ...

January 24 2014 Opening

Friday, January 24th, 2014

Some mornings when I sit here is is difficult to know what to write about because so little has happened overnight. This morning as I contemplate the global financial landscape I have the opposite problem as the financial world is a dangerous place once again. Weakness in  emerging market currencies ...

Malthusian View

Thursday, January 23rd, 2014

The CEO of Google Eric Schmidt speaking at the Davos gathering with a dim and dismal view of the labor market as computers replace people in many jobs. Many economists are suggesting that the rush to automation may have a permanent effect on the labor market. Here is the entire ...

Mutual Fund Flows

Thursday, January 23rd, 2014

Merrill Lynch Pierce Fenner and Smith on mutual fund flows: Tapering bond outflows. So far this year we have not seen significant outflows from bond mutual funds and ETFs, and this week (ending on Wednesday January 22) was not an exception. Recall that bond funds experienced sharp outflows in the second ...

late in Day Note

Thursday, January 23rd, 2014

I was just reading some dealer end of day stuff and here is a recap on client flows. One dealer noted broad based buying of 3s 5s and 7s. A second dealer was a bit more expansive as he saw real money sellers in 10s and fast money selling 5s. ...

An Interest Rate Strategist Whispers the “R” Word

Thursday, January 23rd, 2014

Richard Gilhooly is an interest rate strategist at my former employer and a friend. He write some excellent stuff and I actually refrain from using more than occasional snippets of his musings for fear of overusing his material. In this instance though I am cutting and pasting his full piece ...

MBS

Thursday, January 23rd, 2014

Mortgages are lagging their Treasury cousins as investors seek safe sanctuary today. MBS are  3 to 5 ticks wider to Treasuries and 1 to 2 ticks wider to swaps. Higher coupons are outperforming as the curve steepens. There has been very little selling but a paucity of buyers other than ...

Daily Dearth of FRNs

Thursday, January 23rd, 2014

Interesting Factoid via Bloomberg: By Lisa Loray Jan. 23 (Bloomberg) -- Today is the first issuance day of 2014 without floaters.  So far this year, $19.3b of FRNs have been issued, or more than 14% of IG volume. * 3Y is the most active tenor for FRNs, with $8.2b priced (42%), follwed by <3Y with $5.9b ...

Yen

Thursday, January 23rd, 2014

The world is short yen and that is one very well populated trade. As traders peel away risk that trade is being covered and JPY is through its 50 day moving average at 103.32

TIPS Result

Thursday, January 23rd, 2014

This via Ian Lyngen at CRT Capital *** The 10-year TIPS auction was mixed with a 1 bp tail and non-dealer bidding at 60% vs. 56% norm. *** * 10-year TIPS auction stops at 0.661% vs. a 0.651% 1-pm bid WI. * Dealers were awarded 39.9% vs. 44% average of last six new ...