Before I kick off today's note, I want to remind everyone that has not already done so to open the link below and fill out the requested information: https://www.jefferies.com/zervos/register.aspx Only those folks who do so will continue to receive the commentaries when we switch over to a new distribution list in coming weeks. I know […]

Well, the big week has come and gone and what do we have to show for it? US equities are up 10% YTD, investment grade credit spreads are back to late 2007 levels, US individual tax rates are not likely to rise and the economic data continue to surprise on the upside. It’s all puppy […]

Below, I have put the Ben Bernanke op-ed piece from yesterday into a format that should be a little more transparent. Rather than an article, I have reformatted it as an open letter to the key holders of US sovereign debt. Dear Global Reserve Asset Managers, I regret to inform you that unless you sell […]

The most important part of yesterday's fed announcement came this morning during Asian trading (maybe I should always plan to travel around Asia on fomc days). Around 9am Singapore time, Ben released an op-ed piece in the Washington post to clarify the fomc actions. This is the first time I can ever remember such an […]

The statement suggests the Fed is going to focus on the 2-10 year sector. Long maturity bonds will struggle after this announcement. The 600 number gives them a "more aggressive" ease relative to expectations, especially with a commitment through Q2 2011. The statement itself is dovish, with the inflation paragraph actually fully deleted and replaced […]

It’s a big week for the US - landmark elections, epic monetary policy changes and of course a host of key economic data releases culminating with payrolls. The tone for year-end (and probably even 2011) will almost surely be set this week! Resolving the current uncertainty surrounding fiscal and monetary policy in a way that […]

It’s been a whirlwind tour through Austin, San Antonio, Houston and Dallas. Trying to find time to write has been difficult. But I wanted get some quick thoughts out as the market moves are starting to get very interesting. Most importantly, we are now almost back to pre Aug-10 FOMC meeting yield levels in cash […]

After spending the bulk of last week in Boston, I'm off to the great state of Texas this morning for more client debate and discussion on the Jefferies global macro outlook. There was no shortage of controversy in virtually every meeting last week as our JEF rose colored glasses occasionally offended the sensibilities of those […]

The FED will be successful at reflating the US economy. However, the buying of Treasuries, to push long term government bond yields lower, will not directly transmit lower funding rates to any important parts of the economy (such as the household sector). In fact it may not even drive long term government bond yields lower […]

It amuses me to this day to see respectable institutions suing mortgage originators for violations of reps and warranties associated with the creation of non-agency residential mortgage backed securities. The whole creation of alt-a and subprime securities came about because there were borrowers who could not qualify for agency mortgages. They were risky borrowers!!! Their […]