The T Report: Ruby Red Slippers

Posted by on Mar 22, 2012 in Uncategorized | No Comments

For 2 days, the markets bought the dip in spite of negative economic data and signs that nothing has been fixed in Europe and that Spain could quickly become another problem.  Right now a lot of bulls are clicking their heels together and hoping to get back to the highs.  That is a very risky […]

Spanish Yield Curve – A loud whisper?

Posted by on Mar 22, 2012 in Uncategorized | No Comments

With ZIRP and LTRO it is hard to get a good read on the Spanish yield curve and what anything means. Spanish 10 year yields have risen 9 days in a row, 5 year yields have moved higher 8 out of 9 days, and the 2 year has been much more mixed, until recently. The […]

Spanish bond yields ready to breakout higher?

Posted by on Mar 21, 2012 in Uncategorized | No Comments

  I don’t follow charts that much, but a lot of Chico’s chart based calls have been correct and this one is intriguing as he points out that the yields are potentially breaking out of a ceiling. A lot of people are wondering why Spain is suddenly a focus?  It has been drifting for almost […]

Seems a lot like July 2011 again, and watch out for Spain.

Posted by on Mar 21, 2012 in Uncategorized | No Comments

Spanish yields are back above Italian bond yields, like they were in July 2011.  For both countries, the yields are actually similar to where they were back then. I think the fact that Italy is back to tighter than Spain is meaningful.  While Italy is a long way from being fixed, it is  clear that their former leader was […]

The T Report: Strength Across Almost All Credit Markets

Posted by on Mar 21, 2012 in Uncategorized | No Comments

All the CDS indices are better this morning.  IG, MAIN, and SNR FINS are all 2 to 3 bps tighter again today, and even HY17 is participating in the rally and is trading above 99.  HY17 has been a laggard, but has been outperforming the HY ETF’s.  Both HYG and JNK closed slightly lower yesterday […]

Greek CDS Settlement – 3 Wrongs Do make a Right

Posted by on Mar 20, 2012 in Uncategorized | No Comments

One of the central premises of CDS is that the “basis” package should work.  An investor should be able to buy a bond, and buy CDS to the same maturity and expect to get paid close to par – either by the bond being repaid at par and the CDS expiring worthless, or through a […]

The T Report: CDS Roll – More Technical Than Meaningful

Posted by on Mar 20, 2012 in Uncategorized | No Comments

A relatively quiet morning in credit in spite of the CDS rolls.  The “on the run” single name CDS contract changes from March 2017, to June 2017.  So every single name 5 year quote will now be for June 20, 2017.  A little bit technical for the market, and a lot annoying for most clients.  […]

The CDS Auction Process – Not So Scary

Posted by on Mar 19, 2012 in Uncategorized | No Comments

First, I believe that the regulators should be forcing CDS to be cleared if not exchange traded.  But in any case, there are once again concerns about the “auction” process and what it means. Yes, it is slightly weird to settle a contract based on an “auction” but it is actually both a useful step […]

The T Report: A mixed and dull open

Posted by on Mar 19, 2012 in Uncategorized | No Comments

Asia was mixed, with Hong Kong down noticeably, but Chinese markets okay. Europe is pretty much down across the board, with the exception of Spain doing well. US Futures are mixed, with AAPL helping Nasdaq remain positive. On the Credit Side, the story is similar. European corporate are better with XOVER continuing its impressive performance […]

Crude Oil Reserve Emergency Release?

Posted by on Mar 15, 2012 in Uncategorized | No Comments

We no longer wait for a rainy day, the hint of rain is enough to spur us into action.