The text of the EU statement on Greece is at the end of this commentary. In a nutshell, the no bailout clause has been completely circumvented and we are seeing direct bilateral aid to Greece. As Percy Shelley wrote many years ago (and Bill Clinton restated in 1999) - “We are all Greeks” - at […]

Front end trades ok post numbers. Back end feels soggy. I still cannot get excited about selling a market that’s sits at the high end of the yield range. The number had something for everyone but less census than expected and more private payrolls than ADP indicated is most certainly the cause for the leak […]

So there is the individual non-agency MBS CDS book with 2000+ line items. Then there are the interesting positions where they were shorting muni CDS on Nevada, California and Florida. And back in MBS space, there are billion dollar slugs of subprime mezz bonds and every kind of Agency CMO structure under the sun. To […]

I assume some payroll expectation revisions will start flying across the screens – there were a few 350/400 numbers out there! Whoops!!! Looking at the ADP report details, it was another tough month for small goods producing firms coming in at -27k. With this survey being spot on in the last 3 months, and having […]

It is quiet. Rates are holding at the top end of the range and the curve is maintaining a steepening bias. Swap spreads have stabilized, the Bund/US spread continues to widen, vol is drifting lower and MBS is widening a smidge. It feels like a whole lot of nothing as we await quarter end flows, […]

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 is looking for low to mid 100s, the consensus […]

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 had some puts from an old […]

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 into Treasury rates, curve and volatility. So, what is […]

A chart to chew on.....this is a US long term government debt problem...not a LIBOR problem!!

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 yield, with a fiscal nightmare on our hands, will […]