Headlines – Today’s, Yesterday’s, And Tomorrow’s
Yesterday China cut rates yesterday potentially as part of a globally co-ordinated central bank plan or co-incidentally because their economy was losing steam or both. I would bet there was communication and that may have impacted timing but with the weak PMI number China did what was necessary for China – as they always do. […]
It’s The Thought That Counts
Stocks moved almost 6% from their overnight lows. The China reserve rate cut was real. The globally co-ordinated swap plan mostly just took a plan that was globally approved in September and cut the rates by 50 bps. It is neither a benchmark rate and it is not clear the program is even being used […]
Lost In The Shuffle…
Great US data. Much better than expected. Clearly a good sign. Monti says IMF loan not being considered for Italy. Juncker says EFSF Capacity may reach 750 billion. Guess he had to come up with some number. Greek debt is not being renegotiated? The globally co-ordinated central bank policy moves have started, and more likely […]
Euro Basis Swap
So the Euro Basis Swap is once again a topic of conversation. It was certainly on the radar screen of the bears as one of the rates that was not responding to the “Grand Plan” or other policy actions. On September 15th, the first attempt at global co-ordination to bring the rate down was done. […]
(BN) ECB Coordinated Policy Action Is ‘Big Deal’ — From September 15th
The story below is from September 15th. On September 9th, SPX closed at 1154. On the morning of the 15th the “unprecedented” global co-ordination was put in place. SPX went to 1210 that day, closed at 1216 the next and was at 1130 by September 22nd. History doesn’t repeat itself, but it seems like no […]
So I Beat The “Cut” Announcements By 2 Minutes…
As I suggested in “headlines” we were due to get a move by the ECB especially on the back of China’s move. This isn’t quite that, but similar idea. More people just bought stocks than know what a central bank swap line is. More people are fading the rally than know what a central bank […]
Headlines And What They Mean
The market has decided that we will get IMF/ECB support, ECB rate cuts and QE3. The headlines continue to be messy at best, but the market has decided that the leaders will “see the light and go for the only possible solution”. They probably will, though there is scant evidence that it is really a […]
(BN) *GERMAN 1-YEAR NOTE YIELD FALLS BELOW ZERO, FIRST TIME ON RECORD
Maybe declaring Germany’s safe haven status as dead was premature? If this is the market “punishing” Germany for their reluctance to print, there may be some Germans asking for more such pain. One premise behind the idea that Germany will cave and let the ECB print its way to “salvation” or a bigger crisis, was […]
3 Strikes And You’re In!
The “Grand Plan” on October 27th had 3 prongs. Bank recapitalization. That has been a failure. The EFSF gave up on that and just said it would loan to member countries so they could recapitalize. Since the EFSF was supposed to lend to governments anyways, how is this different? So fail on any form of […]
Financial Bonds Are Hit By Deleveraging – Basis Widening
Remember how many people were complaining about how illiquid CDS was. What a bad indicator it was compared to bonds. That it was unfair that MS bonds were under pressure due to CDS? That was the “spin” back in late September and early October. It didn’t matter that CDS volumes are higher than any individual […]