Archive - May 2009

First Treasuries have gotten walloped, to far beyond pre QE levels (the 10 UST is getting monkeyhammered as I type, see below), next the 2s10s curve has steepened to almost record levels (at 271 bps recently, record wide at 273 bps, a mere 2 bps away), and now the pain is slowly shifting into mortgages.

In the annals of rank regulatory intercourse there isn't much more severe debauchery than the distant history that is the BankUnited story. Yes, big bank failures have become so common that they seem to pass through the cycle news unnoticed, untapped and unexplored. The ugly girl on prom night. Attended to briefly, then discarded in the blinding haze of hangover blurred Sunday morning sunshine, a rueful shake of the head and the cursed oath never again to drink Jagermeister.

As of yesterday, over 4,700 people had signed the petition by Alan Grayson to get Democrat co-sponsors of Ron Paul's HR1207 bill to audit the Federal Reserve. Even more importantly, 14 members of the House Of Representatives have joined Raul Grijalva, bringing the total cosponsors to 181.

Despite all my efforts, Zero Hedge keeps growing. Like a tumor. I always said if I had a tumor I would name it "Marla." So now we are stuck with Marla. Marla Singer, to be precise. In addition to stealing from laundromats, chain smoking and attending testicular cancer support groups, Marla brings to Zero Hedge a bitter blend of confrontational, thought-provoking prose, and razor sharp insight. Forgive her if her reporting resembles an expletive-laced stream of consciousness. She constantly has a stomach-full of Xanax.

The most recent, April, reading of the NY Fed's Index of Coincident Economic Indicators (CEI), indicates continued decline in activity in New Jersey, New York State and New York City.

The Index declined as follows:

New York City - 4.1% annualized decline for April, following a 5.2% decrease in March
New York State - 8.1% annualized decline for April, following an identical decrease in March.
New Jersey - 6.5% annualized decline for April, following a 6.6% decline in March.

The most recent, April, reading of the NY Fed's Index of Coincident Economic Indicators (CEI), indicates continued decline in activity in New Jersey, New York State and New York City.

The Index declined as follows:

New York City - 4.1% annualized decline for April, following a 5.2% decrease in March
New York State - 8.1% annualized decline for April, following an identical decrease in March.
New Jersey - 6.5% annualized decline for April, following a 6.6% decline in March.

The most recent, April, reading of the NY Fed's Index of Coincident Economic Indicators (CEI), indicates continued decline in activity in New Jersey, New York State and New York City.

The Index declined as follows:

New York City - 4.1% annualized decline for April, following a 5.2% decrease in March
New York State - 8.1% annualized decline for April, following an identical decrease in March.
New Jersey - 6.5% annualized decline for April, following a 6.6% decline in March.

The latest data out of DTCC indicates that the volatility in the equity world is spreading to credit. Not only that, but last week the CDS market turned decidedly pessimistic, with over $215 billion in net CDS purchased, the highest amount in terms of net notional in over 2 months. Cumulative net CDS purchased since the start of April has ramped up to almost half a trillion dollars.

Submitted by John Bougearel of Structural Logic

• Recovery in the second half of this year will be 'moderate,' according to a report from the National Association for Business Economics
• S&P Case-Shiller national index posted a 19% drop in Q1.
• The world’s shipping lines may double the number of idled container carriers to 20% of the global fleet.
• U.K.
  

• Banks aiming to play both sides of same coin, will rape and pillage FDIC's deposit insurance reserves in order to speculate in PPIP (WSJ)
• Mortgage refi applications drop 14% on rising mortgage rates (Bloomberg)
• GM Misses Goal for Debt-Equity Swap Before Bankruptcy Deadline (

Developing story: Per BNO, Bloomberg, and WSJ, North Korea has said it will "use its military" to respond to South Korean decision.

Update from BNO: NORTH KOREA ABANDONS KOREAN WAR ARMISTICE.

Developing story: Per BNO, Bloomberg, and WSJ, North Korea has said it will "use its military" to respond to South Korean decision.

Update from BNO: NORTH KOREA ABANDONS KOREAN WAR ARMISTICE.

• George Orwell headline of the day: Yen declines as signs of U.S.