Seeing Greek bond investors take a 50 percent haircut, the 10yr BTP/Bund spread back to the August wides above 400 and the 10yr OAT/Bund spread north of 100 at the same time spoos have rallied 20 percent and CDX HY has fallen nearly 300bps over the past month is about as good as it gets […]
After sifting through the EU document, there is reason to be impressed – 17 George Bushes, 17 Nancy Pelosis and 17 Hank Paulsons sat down at dinner and achieved some important decisions on loss sharing. There were 4 basic things agreed – 1. A “coerced” loss for holders of Greek debt of 50 percent. 2. […]
Before diving into the pressing issues of the moment, let’s get some baseline macro perspective on current price action. US equities (ex the financially repressed) are trading about as well as anyone could expect. US corporate credit is recovering nicely from the summer rout with liquidity about as poor as at time in recent memory. […]
It’s been quite a trip through Europe this past week. Our central bank and SWF conference in Rome provided some very lively debate, as did the many client meetings in Geneva and London. I have a lot more to write about regarding Europe, but I will save that for Monday when I’m back stateside with […]
So here we sit with the DJIA and Nasdaq unchanged on the year, while the spoo is spitting distance from the green zone. At the same time core European bond markets are finding very little support, with some fairly aggressive moves in France and Belgium most recently. The market is finally correctly pricing in a […]
“I know what you’re thinking, ‘Did he fire six shots or only five?’. Well to tell you the truth, in all this excitement I kind of lost track myself. But being as this is a .44 Magnum, the most powerful handgun in the world, that would blow your head clean off, you’ve got to ask […]
I spent all of last week on the west coast of the US crossing paths with about 300 clients from nearly 30 institutions. As to be expected, all discussions centered on Europe. While our highly pessimistic view on Europe met with only minor resistance, our idea that a European financial sector nationalization process would NOT […]
After a disappointing week – like the one we just went through – I always do two things. First I reread Ben’s classic “helicopter” deflation speech from 2002 – http://www.federalreserve.gov/boarddocs/speeches/2002/20021121/default.htm And second, I reread Herbert Hoover’s acceptance speech after his nomination as the republican party candidate for the 1932 presidential election. If u can take […]
Today should have been some sort of momentous occasion. The Germans have backed an expanded EFSF – but the markets are about as excited as Red Sox fans. The new chatter is that this expanded power is not enough – which is of course correct – the EFSF would need trillions to fill the holes […]
Here is an excerpt from Fed Governor Raskin’s speech yesterday: “Indeed, some commentators assign a label of “hawk” or “dove” to the various FOMC participants in an attempt to characterize how we prioritize the goals of maximum employment and price stability. In my view, such labels are ill conceived and misleading because everyone on the […]