The Fed Should Hire A Mechanic
The “Transmission Mechanism” Is Broken. As the Fed debates what form of QE to launch on the world and whatever new communication strategies they are going to employ, maybe they should sit back and figure out why their policies seem to be doing so little. The Fed is clearly trying to stimulate the economy. As […]
When “Sneaky” Long Isn’t So Sneaky…
I’m back from the snow and am wondering where all the bears went? I cannot find more than one person willing to be outright bearish. What is particularly strange is that the reasons most people are bullish seem to have little, if anything to do with fundamentals – either macro or micro. The reason for […]
The ESM / EFSF Bluff
Holding 10, Queen, not suited, small stack, is it time go all in? Both EFSF and ESM rely primarily on guarantees which we know Most European politician think is as valuable as toilet paper, so why not provide more? The ESM does have some paid in capital, but the plan is for minimal paid in […]
Why Are Greek Credit Event Swaps Still In The Mid 60’S?
As we wait for more IIF announcements about the Greek Private Sector Involvement (PSI), Greek CDS remains bid above 60 points up front. For a contract that is about to be “worthless”, this seems to have a lot of value. Why would Greek CDS still be so well bid? One answer is stubbornness and stupidity. Maybe the CDS […]
LTRO Version 0.2
LTRO version 1.0 continues to capture the markets attention. It was a reason to rally, then fade, now back to an excuse to rally. My contention all along has been that LTRO was good for banks. It dramatically reduced the liquidity risk for banks. It did nothing for the solvency of banks or sovereigns, and […]
Greek Psi Here We Come? Be Careful What You Wish For
So it looks like we should get an announcement sometime today about the proposed Greek PSI deal. Yes, proposed, not finalized. Asides from the obvious fact that there will be limited or no documentation for the deal, we still have no clue who has agreed to what. As far as I can tell, no one […]
I’m In Denver And Can Feel The Squeeze From Here
Strong auctions helping. We forget March 2010 Greek auctions and August 2011 auctions. flippers and short covering or real change of risk tolerance? Greek PSI rumors helping. Watching the sausage being made might turn you off sausage for awhile. Financials and the bonds of financials are really strong. Europe in particular. Finally!! LTRO 1.0 should […]
Greek PSI
The Greek PSI is once again (still) hitting the headlines. Here is what I think the most likely scenario is (80% likelihood). Some form of an agreement will be announced. The IIF will announce that the “creditor committee has agreed in principle to a plan.” That plan will need to be “formalized” and final agreement […]
Daily Credit ETF and Index Summary (12.01.18) – Not So Strong So Far
As confusion still seems to reign supreme the markets swing from feeling well bid to well offered on next to nothing. Having said that, the universal opinion is that anything you are short is inexplicably strong, and anything you are long, is weak. Yesterday we were strong at the start of the day and the […]
(BN) IMF Said to Seek $1 Trillion Resource-Boost Amid Euro Crisis
This is starting to be more and more like a bad Austin Powers movie. Why should this group of unelected, many appointed based more on their political connections than their qualifications deserve so much money? This was a cute and slightly prestigious entity when it helped channel the charity of big rich nations into small […]