With an eventful week behind us, it’s time to get ready for some payroll fireworks. The half day Friday should be action packed, and illiquid, as equity markets are shut and bond market are open (something that happens with frequency of a venus transit eclipse). Ward...
Those who know me well know that I disavowed trading LIBOR many years ago. It all stemmed from some experiences in 2007 when I happen to stumble into making a lot of money on some seemingly worthless EDU7 puts. I was quite pessimistic on the economic outlook, but I...
I generally do not comment much on swap spreads as we at Jefferies are only involved in trading instruments with cusips (something I am quite pleased about). That said, the moves in swaps are going to feedback into MBS market valuation and also provide some insight...
It’s a quiet start to a front end auction week, with the curve recovering a tad from last week’s hangover. I think the “reach for yield argument” discussed in last Friday’s comment provides the best rationale for why we have seen the flattening. But reaching for...
The inflation data and the FOMC were unequivocally dovish. The long end traded in sync with these results with 30s up 23 ticks on the week. The short end, however, marched to different tune with 2s down 1 tick on the week. I do not believe the discount rate rumors are...
There is little to talk about before 2:15 so I’ll keep this brief. The key focus for the market is on a Bullard (and possibly a Warsh) dissent. I think these are very remote possibilities. Let’s start with Bullard - he has been talking about a recovery that is “on...
Hopefully, everyone has copy of the new monthly. As discussed in that document, we see the next 3 months as calm for fixed income. Nonetheless, we will no doubt have some “in range fireworks” as we did last week. Over the last 5 trading days, we went from 2.78 to 2.83...
Brian Sack (aka mini-Ben) gave a speech last night reiterating the basic exit structure put forth by the Chairman in February. There was little new in the speech, but there are a few parts worth repeating here as we enter the battle zone on asset sales between the...
Brian Sack (aka mini-Ben) gave a speech last night reiterating the basic exit structure put forth by the Chairman in February. There was little new in the speech, but there are a few parts worth repeating here as we enter the battle zone on asset sales between the Presidents and the Governors. First, everyone agrees […]
