Posts Tagged ‘LCH.Clearnet’

Notes From Underground: Hey, Mario Draghi! UNPACK THE SPEEDO AS THERE WILL BE NO SUMMER VACATION

July 23, 2012

The ECB will be visiting Spain but it will not be heading to the beaches. The EUROPEAN DEBT markets were a problem today and not because of the SPANISH 10-YEAR. Today it was the SPANISH TWO-YEAR NOTE that bore the brunt of investor angst. The short-duration paper was 88 BASIS POINTS higher as the 2/10 curve collapsed 55 basis points: FRANKFURT WE HAVE A PROBLEM. President Draghi, as an ex-GOLDMAN banker you well understand that when the markets sense weakness an attack on the soft spot is imminent. The action in the SPANISH DEBT markets is the first warning sign.

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Notes From Underground: Bernanke sings with Huey Lewis–Your Cash Ain’t Nothing But Trash

November 4, 2010

In day one of the world held hostage, the FED‘s QE2 program proved a great success. The dollar declined. Commodities soared. Metals shined. The equity markets took its newfound wealth effect in full stride. And the Treasury market rallied. Even though the 30-year bond is not a major component of the FED‘s purchasing program, it too rallied strongly as the sub 2.5 percent yield on the 10-year note sent investors further down the curve looking for a little more yield. The FED got all the bang out of the “wealth effect” that it could as investors around the world have realized that their  “cash was nothing but trash”–exactly the outcome the FED is looking to achieve.

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