St Patrick Day Miscellany

March 17th, 2008 9:06 am | by John Jansen |

 Trading in Treasury securities this morning very light as many traders have been forewarned to keep their activity to a minimum. Senior mangement does not want someone lobbing a plugged in toaster into the crowded swimming pool. So until participants can figure out how the next act unfolds liquidity should be impaired and activity subdued.

MBS market is tighter to Treasury market by 8 ticks to 9 ticks but most of that occurred late Friday. Clients have been better buyers of MBS .

There is some very interesting price action in TIPS this morning. I am a maven of the 10 year TIPS breakeven and that spread had recently approached 260 basis points. Today it is back into to 232 basis points. The 10 year TIP is off 8/32 while the 10 year note is up 20/32. Oil , copper are all taking a pretty good drubbing and that has lead to the demise of TIPS.

Agency debt continues to lag swaps and made a new wide at LIBOR + 40 this morning.

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