Archive for February, 2016
Thursday, February 11th, 2016
Via the FT:
SocGen shares tumble 13% as sector sell-off resumes
Bank sees risks from unstable markets and low rates
Read latest:
by: Michael Stothard in Paris
Société Générale signalled on Thursday it may struggle to meet its profitability targets this year because of “headwinds” that include record-low interest rates and volatile financial markets.
The French ...
Posted in Uncategorized | Comments Off on SocGen Stock Crumbling
Thursday, February 11th, 2016
Markets are crumbling overnight and 10 year US trades at 1.618. One simple indicator I watch is 10 year Spain versus 10 year US. At this time yesterday morning 10 year US was 1.77 and 10 year Spain was 1.69. As we speak this morning 10 year US is 1.62 ...
Posted in Uncategorized | Comments Off on “Bad News is Actually Bad News”
Wednesday, February 10th, 2016
Via Bloomberg:
Many banks refuse to short auto ABS; some fear reputation risk
Investors keen to short bonds as delinquencies tick higher
A group of hedge funds, convinced they have found the next Big Short, are looking to bet against bonds backed by subprime auto loans. Good luck finding a bank willing to ...
Posted in Uncategorized | Comments Off on Sub Prime Auto as Next Big Short
Wednesday, February 10th, 2016
I just read an FT story (which I will append to this) which notes that 2s 10s is at its tightest levels in eight years.
I was just marking closing levels and some other spreads are worthy of notice. I do not have Bloomberg analytics so I can not say when ...
Posted in Uncategorized | Comments Off on Curvology
Wednesday, February 10th, 2016
Via Stephen Stanley at Amherst Pierpont Securities:
Chair Yellen’s monetary policy testimony is pretty standard fare. By and large, the structure and tone of her remarks tracks the language of the January FOMC statement, which in most circumstances is exactly to be expected. In the current situation, however, that is noteworthy ...
Posted in Uncategorized | Comments Off on Yellen Synopsis
Wednesday, February 10th, 2016
Via Ian Lyngen at CRT Capital:
We are optimistic about this afternoon's 10-year auction and expect non-dealer interest to be a significant test of overseas demand for the sector at current yield levels. We see the risks skewed toward a stop-through. This morning's selloff is pricing-in a meaningful concession off the ...
Posted in Uncategorized | Comments Off on Ten Year Auction Outlook
Wednesday, February 10th, 2016
Martin Enlund is a friend of this blog and Chief Analyst at Nordea Markets. He has written an interesting piece on the European banking turmoil.
Via Martin Enlund at Nordea Markets:
Good morning!
To begin with, let me say that I am not a credit strategist… and it may well be that this ...
Posted in Uncategorized | Comments Off on A Mini Lehman
Wednesday, February 10th, 2016
Via Bloomberg:
WHAT TO WATCH:
* (All times New York)
* Economic Data
* 7:00am: MBA Mortgage Applications, Feb. 5 (prior -2.6%)
* 2:00pm: Monthly Budget Statement, Jan., est. $47.5b
(prior -$17.5b)
* Central Banks
* 8:30am: Yellen’s prepared remarks to House committee
released
* 10:00am: Fed’s Yellen testifies to House committee
* 1:30pm: Fed’s Williams speaks in Los Angeles
* Supply
* ...
Posted in Uncategorized | Comments Off on What to Watch Today
Wednesday, February 10th, 2016
Via the WSJ:
By Dan Strumpf and
Joe Light
At the start of 2016, Americans were bracing for interest rates to rise significantly for the first time since the financial crisis.
Instead, rates have slumped anew, rattling financial markets and undoing the plans of investors, consumers and businesses alike.
A little more than a month ...
Posted in Uncategorized | Comments Off on Low Rates Losing Their Punch
Wednesday, February 10th, 2016
Goldman Sachs six weeks into 2012 has abandoned five of it top recommended trdes for 2016.
Via Bloomberg and link to story with graphs which do not reproduce well here:
New York bank closes bet on dollar strength versus euro, yen
Divergent-rates policy still favors greenback, Himmelberg says
Goldman Sachs to clients: whoops. Just six ...
Posted in Uncategorized | Comments Off on Goldman’s Mea Maxima Culpa