Archive - Apr 2, 2009

TrimTabs is out with the latest mutual fund flows for the week ended April 1. The research company estimates that the past week saw $11.2 billion in outflows among the equity mutual fund community, which doesn't jive too well with all the rampant speculation about vanilla money running head over heels to throw their money into the rally. TrimTabs estimates the prior week inflow to $1.7 billion, implying a new swing of over $12.5 billion WoW.

Spreads were tighter in the US today as all the indices improved, although IG and HVOL ended at the day’s wides. Indices typically underperformed single-names with skews mostly narrower as IG underperformed but narrowed the skew, HVOL underperformed but narrowed the skew, ExHVOL intrinsics beat and narrowed the skew, XO underperformed but compressed the skew, and HY outperformed but narrowed the skew.

Bill Gross, fresh from swimming in the nickel and dime pool, and purchasing another zillion in MBS, shares some insight. Amusingly, PIMCO is now on Facebook and Twitter, with a new friendlier, jollier, less taxpayer-crippling and hyperinflation inducing face.

After the PPIP seemed like a done deal with its legacy loan and legacy security purchasing aspects already virtually set in stone, the FDIC surreptitiously slipped this Request For Comments (RFC) on its website. Two of the proposed questions submitted by the FDIC bear particular attention:

As Zero Hedge postulated a month ago, the VIX - sovereign CDS inverse correlation is becoming more and more evident. Today's action is representative: as VIX continues to slowly trickle lower, US protection is 5 wider. With the G20 pledging trillions to battle every cough and sneeze of the markets, the question becomes what does all this mean for sovereign default risk, and thus VIX, and thus equity markets.

As Zero Hedge postulated a month ago, the VIX - sovereign CDS inverse correlation is becoming more and more evident. Today's action is representative: as VIX continues to slowly trickle lower, US protection is 5 wider. With the G20 pledging trillions to battle every cough and sneeze of the markets, the question becomes what does all this mean for sovereign default risk, and thus VIX, and thus equity markets.

IG 12 back to virtually unchanged at 197 bps after opening 4 tighter: the credit market is not buying it. Equity market is... well... the equity market. Those who say credit markets have been wrong for the past 6 weeks may be on to something... or not

Zero Hedge is happy to introduce its newest contributor, Travis, whose extensive background in the intricacies of the ultraluxury world will provide a welcome perspective on the mysterious world of goods that usually show up in the pages of the Robb Report, on the walls of Stevie Cohen's uber-plumbed mansions and on the wrists of momentum chasing day traders (one has to give it to them: they have made a mint over the past month; their mutual fund brethren who are only now getting involved will be stu

Bank CDS post-FASB:

BAC 377bp -20,
C 640bp -20,
JPM 190bp -10,
WB 292b -15,
WFC 292b -15,
MER 545b -20,
MS 382b -15,
GS 287b -10

compliments of Mojakus

As the world relishes in its self-reinforcing view that all is somehow well, there are some points that deserve to be pointed out:

April 2 (Bloomberg) -- The Financial Accounting Standards Board, pressured by U.S. lawmakers and financial companies,voted to relax fair-value rules that Citigroup Inc. and Wells Fargo & Co. say don’t work when markets are inactive.

April 2 (Bloomberg) -- The Financial Accounting Standards Board, pressured by U.S. lawmakers and financial companies,voted to relax fair-value rules that Citigroup Inc. and Wells Fargo & Co. say don’t work when markets are inactive.

Initial jobless claims: upward revision for February to 657K, March survey: 650K, actual 669K

Continuing claims: upward revision for February to 5567K, March survey: 5590K, actual 5728K