Daily Credit Summary: June 24 - FOMC Kegels
Submitted by Tyler Durden on 06/27/2009 - 16:59Spreads were tighter in the US as all the indices improved (though 2-3bps wider than the pre-FOMC tights in IG). Indices generally outperformed intrinsics with skews widening in general as IG's skew decompressed as the index beat intrinsics, HVOL outperformed but widened the skew, ExHVOL outperformed pushing the skew wider, XO's skew increased as the index outperformed, and HY outperformed but narrowed the skew.
BofA Smoking Gun?
Submitted by Tyler Durden on 06/27/2009 - 16:59Developing story from Huffington Post:
Tim Geithner, Treasury Secretary, supposedly emailed telling BofA that they couldn't back out of acquiring Merrill Lynch, according to CNBC. An email by Geithner telling BofA to close the deal would be a proverbial smoking gun, since BofA honcho Ken Lewis has said he was forced into buying the bank and not publicly revealing the poor financial shape that Merill Lynch was in, in the wake of pressure from the government.
hat tip Vaughan
Merrill's New REIT Teams Marks REIT Territory
Submitted by Tyler Durden on 06/27/2009 - 16:57The brand spanking new team (and legacy boy Craig Schmidt) that Merrill recently acquired from some other bank (I wrote about this, but frankly don't remember where these clowns came from nor do I care), just went to town all over the REIT bathroom and marked their territory effusively. ML in fact distributed a 45 page reinitiation report, which I have no intention of ever reading.
Direct CHF Manipulation Visualized
Submitted by Tyler Durden on 06/27/2009 - 16:55
This is what direct, premeditated, overt manipulation looks like.
I Would Like To Thank The Academy, Goldman Sachs, And God (Jeff Immelt)...
Submitted by Tyler Durden on 06/27/2009 - 16:53Was that Cramer complaining there is too much democracy in this country? My dear, you of all people should be so glad for First Amendment rights after losing hapless mom and pop retail investors, whose only sin is listening to you, countless billions and billions of dollars.
Goldman Sachs: "Engineering Every Major Market Manipulation Since The Great Depression"
Submitted by Tyler Durden on 06/27/2009 - 16:51With a subtitle like "From tech stocks to high gas prices, Goldman Sachs has engineered every major market manipulation since the Great Depression - and they're about to do it again" run, don't walk, to your nearest kiosk and buy Matt Taibbi's latest piece in Rolling Stone magazine.
We Have Dollar Liftoff
Submitted by Tyler Durden on 06/27/2009 - 16:50
If anyone knows what the hell is going on with the market since the Fed release (aside from South Carolina Governor Sanford being a big fan of the Buenos Aires Hustler Club), please advise.
Fed Statement
Submitted by Tyler Durden on 06/27/2009 - 16:45Information received since the Federal Open Market Committee met in April suggests that the pace of economic contraction is slowing. Conditions in financial markets have generally improved in recent months. Household spending has shown further signs of stabilizing but remains constrained by ongoing job losses, lower housing wealth, and tight credit. Businesses are cutting back on fixed investment and staffing but appear to be making progress in bringing inventory stocks into better alignment with sales.
Blast From Citi's Phenomenal Analytic Past
Submitted by Tyler Durden on 06/27/2009 - 16:16From Citi - Outlook for 2007: Will Protection Buyers Finally Emerge? The market may have, therefore, come to realize several truths that seasoned CMBS veterans have pointed out for some time: there is little or nothing that could actually cause a principal loss on a super-senior triple-A CMBS, and even the subordinate investment-grade tranches are unlikely to experience severe performance issues in the first few years of the deal.
Rate Hike Expectations Moderating
Submitted by Tyler Durden on 06/27/2009 - 16:12
Inflation expectations last seen at a local Duane Reade buying lots of vaseline.
Swiss National Bank Discloses Further Intervention Possible
Submitted by Tyler Durden on 06/27/2009 - 16:10Developing story: The Swiss - US monetary war is now officially on.
And in other news, documents obtained by the US House Committee indicate apparent dissension among senior Fed officials about BOFA bailout, impact on Fed's bal. sheet. Obama soon to nominate BB for Dictator Czar (yes, yes, I get it).
More Luxury Retail Failures, Buffett On Green Shoots
Submitted by Tyler Durden on 06/27/2009 - 16:09eLuxury is finished - another example of the retail collapse starting to reach ever higher into the "aspirational" segment.
Yesterday's Two Year Treasury Auction Is Now A Loss For Participants
Submitted by Tyler Durden on 06/27/2009 - 16:06
So much for the "wildly successful" 2 Yr UST auction yesterday. If you bought in: congrats - you are now under water. Looks like the 2007 special Goldman 8x leveraged HY bond issue "flip 'em" game has now moved to front end Treasuries.
Goldman Keeps On Cheering CBL... For Now
Submitted by Tyler Durden on 06/27/2009 - 16:03Everyone's favorite Goldman REIT analyst is still not downgrading CBL to a Conviction List Sell. In fact, Habermann is doing all he can to salvage whatever he can. That being said, we give this stock at most 3-4 weeks before it gets whacked if not to a Sell to at least a "Conviction List" Hold.
FDIC Starts Extending The Maturities Of Various Alphabet Soup Crutches
Submitted by Tyler Durden on 06/27/2009 - 16:01The FDIC announced a proposed extension of the first of many alphabet soups currently propping up the banking system. In this case, it is the Transaction Account Guarantee (TAG) component of the TLGP program. The proposed extension (the first of maaaaany) will push the maturity from December 31, 2009 to June 30, 2010.
