Posts Tagged ‘BTP’

Notes From Underground: A (Wo)man Hears What (S)he Wants to Hear and Disregards the Rest

November 16, 2016

Noise fills the airwaves and so many “pundits” keep the outlets from going dark by providing opinions that are less than ridiculous. These are the same people who failed to identify many of the significant political dynamics during the last few years. There is a viral video of Fox Business anchor Maria Bartiromo interviewing the much-maligned Jonathan Gruber. I have no opinion on the politics of the interview but I do offer this criticism of Gruber’s hypothesis of the positive outcome from the Affordable Care Act (ACA). Gruber raises the counterfactual that insurance costs and medical care would be at the same levels as now and maybe even higher and with the addition of 22 million people on the health insurance rolls, the ACA is a success.

(more…)

Notes From Underground: A Little Austerity Goes a Long Way

December 5, 2011

The new autocratic regime in Italy has agreed to a ramped up AUSTERITY BUDGET in which an extra 30 BILLION EUROS will have to be found and then cut from the public arena. Being that Mario Monti was the Eurocrats’ choice to head the Italian government, it seems that PM MONTI is only concerned about meeting the desires of the powers that insisted on his taking the reins of governance. ITALIAN BOND FUTURES staged a very impressive rally as the BTP (10-year note) dropped 71 basis points to close under 6%. Also, the 2/10 year curve in Italy also steepened to +52 basis points from Friday’s close of +38 points. Spain and the other PERIPHERALS also performed well and the FRENCH/GERMAN 10-year differential closed at a mere 92 basis points. As the BTP futures rallied 500+ points, the EURO actually underperformed and by the close the EURO currency was basically unchanged .

(more…)

Notes From Underground: SPANISH MISSTEPS TRIP UP ITALIAN DEBT

November 15, 2011

TO OUR READERS: WE’RE REISSUING LAST NIGHT’S PIECE AS MANY OF YOU DID NOT RECEIVE THE POST BECAUSE OF A WORDPRESS GLITCH. ENJOY!

The DEBT markets in Europe renewed the sombre tone of a collapse of Italy and Spain. In the early part of the European trading day, the Italian BTP was holding on to last week’s gains and outperforming the BUNDS to the upside. As the day wound to a close, the “negative” news out of the Merkel’s CDU conference pressured the DEBT markets as new fears arose that the German Chancellor had her party’s support for the jettisoning of some of the weaker peripherals.

(more…)

Notes From Underground: SPANISH MISSTEPS TRIP UP ITALIAN DEBT

November 14, 2011

The DEBT markets in Europe renewed the sombre tone of a collapse of Italy and Spain. In the early part of the European trading day, the Italian BTP was holding on to last week’s gains and outperforming the BUNDS to the upside. As the day wound to a close, the “negative” news out of the Merkel’s CDU conference pressured the DEBT markets as new fears arose that the German Chancellor had her party’s support for the jettisoning of some of the weaker peripherals.

(more…)

Notes From Underground: Christine Lagarde, the Markets Turn Their Lonely Eyes To You

November 9, 2011

The European debt markets were thrown into further chaos today as the German/Italian 10-year notes spread blew up. In cash terms, the move was a widening of 58 basis points while in futures prices the differential was 512 ticks. Notes From Underground has been monitoring the BUND/BTP futures spread for almost two years. The BUND and BTP 10-year futures are the proxies for Europe as they are the only liquid contracts available to hedge risk. Prior to September 2009, the BUND was the only bond future contract available to manage risk and speculate on the European debt markets. The ITALIANS moves to list the BTP FUTURES so the banks and pensions would have a viable tool in which to hedge the massive amount of Italian debt that was in the market. It seemed that the Italian finance ministry had a noble intention, but as the debacle of the PIIGS has moved to center stage, the Italian BTP has been the only viable tool for speculators and hedgers to participate in the long end of the EURO debt markets.

(more…)

Notes From Underground: Mr. Market to Jean Claude Trichet … CA​N YOU HEAR ME NOW

August 4, 2011

Today’s market meltdown has rendered tomorrow’s employment data from the U.S. and Canada meaningless, but in a more Marxian sense, superfluous. The damage done from the Europeans inability to face the reality of a CREDIT CRISIS is beginning to create high anxiety in all global markets. The theoretical basis for MUDDLING has been exhausted and it is time for real action.

(more…)