Archive for August, 2014

Ukraine Headlines

Friday, August 22nd, 2014

Some Ukraine headline from earlier in the evening which gave Treasury market bit of a bid: 08:49:34 RTRS - RUSSIA WARNS AGAINST ANY ATTEMPTS TO DISRUPT AID CONVOY MOVEMENT 09:40:36 RTRS - REUTERS WITNESS SAYS ABOUT 20 RUSSIAN AID TRUCKS CROSSED UKRAINE  BORDER 09:41:30 RTRS - REUTERS WITNESS SAYS TRUCKS ARE ACCOMPANIED BY SMALL NUMBER OF  ...

Hilsenrath to Start the Day

Friday, August 22nd, 2014

This is  lengthy article by Jon Hilsenrath of the WSJ which breaks no new ground but does a fine job of summarizing the global economy and the policy choices and dilemmas confronting central bankers. Via Jon Hilsenrath and the WSJ: Central Bankers Wrestle With Easy Money Amid Uneven Global Recovery Sluggish Growth Confronts ...

Leverage

Thursday, August 21st, 2014

Corporate Treasurers have been prodigious issuers of debt in Q2. However, Merrill Lynch research reports that leverage decreased in the quarter as earnings outstripped the increase in debt. At the end of the quarter Merrill estimates leverage was down to 1.88 from 1.83 at the end of Q1. Merrill expects ...

Jackson Hole Reconsidered

Thursday, August 21st, 2014

The FT has an article on the changing nature of the Jackson Hole conclave at which Ms Yellen will deliver an ex cathedra proclamation tomorrow. The article details how the list of invitees does not include street economists and has returned to its roots as a place for international central ...

Durables Goods Orders Next Week at An Historic Level

Thursday, August 21st, 2014

A fully paid up subscriber forwarded this note by SOcGen research in which they forecast that durable goods orders will record a gain of 24.5 percent when the number is released next week. That will exceed the previous record of 16.5 percent achieved in 2000. The research piece notes the ...

San Francisco Fed Pres Chimes in on Rate Hikes

Thursday, August 21st, 2014

Via a fully paid up subscriber: SAN FRANCISCO FED PRESIDENT WILLIAMS says that Fed officials "really want to be data dependent" when making policy and that the summer of 2015 is a reasonable date for the first rate hike. Rates could climb earlier if there is "really good" improvement in the ...

Five Year TIPS Result

Thursday, August 21st, 2014

Via CRT Capital: * 5-year TIPS auction stops at -0.281% vs. a -0.275% 1:00 PM bid WI. * Bid/Cover 2.48 vs. 2.64 average. * Dealers were awarded 40.2% vs. 53% average for 5-year TIPS. * Indirects get 56.3% vs. 40% norm. * Directs take 3.5% vs. 7% average. * Dealer Hit-Ratio: Dealers take 25% of what ...

Midday Miscellany

Thursday, August 21st, 2014

The Treasury market is quiet today and most participants support the view that investors are squaring positions and hunkering down in the deep weeds until Ms Yellen shows her cards. There is a TIPS auction in a few minutes and there are very conflicting views on that one. I wrote ...

TIPS Auction

Thursday, August 21st, 2014

The Treasury in its infinite wisdom will auction $16 billion 5 year TIPS today. There is some good news and some bad news for the issue. The issue has cheapened significantly on breakeven. The breakeven was 203 as recently as June 24 and the WI trades around 188. One trader ...

Spread Product

Thursday, August 21st, 2014

Corporate Bonds are opening firmer. One participant reports that intermediate industrials are 1 tighter and 25 year and longer paper is 2 tighter. The IG 22 is at 56 7/8 and tightened 7/8 overnight. Supply will remain light until after the Labor Day Holiday when issuance should pick up again. We ...