2007-12-20 US Economic Releases

GDP Annualized (3QF) Survey 4.9% Actual 4.9% Prior 4.9% Revised n/a Personal Consumption (3QF) Survey 42.8.9% Actual 2.8% Prior 2.7% Revised n/a GDP Price Index (3QF) Survey 0.9% Actual 1.0% Prior 0.9% Revised n/a Above numbers as expected. Core PCE QoQ (3QF) Survey 1.8% Actual 2.0% Prior 1.8% Revised n/a This is ...Read More

it’s about price, not quantity

It’s about price, not quantity. CB’s don’t alter net reserve positions – they ‘offset operating factors’ and set interest rates. Fed to redeem $14.02 bln of bill holdings Dec. 27 Thu Dec 20, 2007 11:20am EST NEW YORK, Dec 20 (Reuters) – The U.S. Federal Reserve said on Thursday it will redeem ...Read More

Commercial paper outstanding continues to fall

Seems to be unwinding in an orderly fashion as lending continues to flow back to the banking sector. UPDATE 1-US commercial paper in biggest weekly drop since Aug Thu Dec 20, 2007 10:41am EST NEW YORK, Dec 20 (Reuters) – The size of the U.S. commercial paper market suffered its biggest weekly ...Read More

SOV CDS

From: ABNAMRO CREDIT SALES (ABN AMRO) At: 12/20 5:18:53 10YR 5YR BELGUIM 19/21 11/15 FRANCE 10/12 6/9 GERMANY 8/10 4/7 GREECE 29/31 22/24 ITALY 29/31 21/23 PORTUGAL 26/28 20/22 SPAIN 25 1/2/27 1/2 19/21 UK 9/11 5/8 USA 8/11 5/8 In the Eurozone, it’s probably the case that if one goes, they ...Read More

AMT tax reduction passes

Looks like it adds about $50 billion to 2008 after tax incomes. Demand can use all the help it can get right now! Congress Gives AMT Relief For 20 Million Taxpayers Congress acted in its final hours Wednesday to block growth of the alternative minimum tax, putting off an economic hardship affecting ...Read More

S&P cuts Alt A mortgages

From Bloomberg: S&P Cuts Alt-A Mortgage Bonds; Analysts Warn on Prime Should already be priced in – been talked about for a long time. Standard & Poor’s reduced its ratings on about $7 billion of Alt-A mortgage securities, citing a sustained surge in delinquencies during the past five months on loans considered ...Read More

2007-12-19 US Economic Releases

Purchase Applications going back 5 years MBA Mortgage Applications (Dec 14) Survey n/a Actual -19.5 Prior 2.5 Revised n/a Looks like it’s still turning up, and continues to be up year over year. Note the sharp fall off every December into year end and quick bounce back early Jan. ♥ ...Read More

Inflation Picture has Deteriorated

He’s on the opposite spectrum from Yellen, but inflation has deteriorated to the point where risks are elevated. Once the fed has figured out it can control the FF/LIBOR with TAF type or repo and ‘market functioning’ somewhat restored, I expect that the imperative to cut rates will be greatly diminished. Fed’s ...Read More

Fed finally gets it?, continued..

Just noticed that as well as limiting the size of the auction, the Fed is limiting tenders from any one insitution to 10% of the auction. Seems the FOMC still doesn’t quite get it yet. :( ♥ ...Read More

Fed finally gets it?

The Fed was finally successful in cutting the fed funds/libor spread with a glorified 28 day repo, after failing to narrow the spread with 100 bp of rate cuts. Narrowing the ff/libor spread ‘automatically’ lowers various libor based funding rates, probably including jumbo mtg rates, which have been a concern of the ...Read More