Bond

The flip flop between equity and credit accelerates. Just as the administration managed to lower mortgage rates enough to get a moderate pick up in refi applications, bonds are starting to get out of control.

The bond ski jumpers are back.

“The
bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways,” Facciponti said. “The copy in Germany is still out there, and we at this time do not know who else has access to it.”

The prosecutor added, “Once it is out there, anybody will be able to use this, and their market share will be adversely affected.”

The proprietary code lets the firm do “sophisticated,
high-speed and high-volume trades on various stock and commodities
markets,” prosecutors said in court papers. The trades generate “many
millions of dollars” each year.

Market tests are useful as they best indicate just what is the real value of hundreds of billions of distressed securities stripped away from any unwarranted optimism and green shoot propaganda. Today's Visteon CDS Auction was just one such test. And if there was a way to grade the test, it would be an emphatic F: not so much for bankrupt Visteon which is already in the morgue, but for other comparable auto suppliers whose bonds and loans recently have seen overambitious PMs buying their debt as if every single credit instrument would be rolled into Taxpayer Capital LLC's Worthless Assets Fund.

No, not with regard to who can put more money into struggling Hell's Angels' favorite company Harley Davidson, or who can launch another failed bond wraparound insurance company... No, we are talking Becky Quick of course, who somehow has a knack for attracting males 2-4 times her own age.

Market tests are useful as they best indicate just what is the real value of hundreds of billions of distressed securities stripped away from any unwarranted optimism and green shoot propaganda. Today's Visteon CDS Auction was just one such test.

Market tests are useful as they best indicate just what is the real value of hundreds of billions of distressed securities stripped away from any unwarranted optimism and green shoot propaganda. Today's Visteon CDS Auction was just one such test.

No, not with regard to who can put more money into struggling Hell's Angels' favorite company Harley Davidson, or who can launch another failed bond wraparound insurance company... No, we are talking Becky Quick of course, who somehow has a knack for attracting males 2-4 times her own age. In the clip below pay attention to Kit Bond's last words.

The charts on the last two pages of this interesting comparison are particularly relevant, with regard to both the bond and the stock market. Courtesy of Black Swan Capital. Are the Fed's machinations setting the market up for another big crash, this one having nothing to do with bank failures and the like?

When a stock goes up by about 10% on a bankruptcy preannouncement, there is nothing much more to be said.

Textron private-jet competitor Hawker Beechcraft was the latest casualty of S&P's ongoing foray into subjective default proclamations, when the rating agency decided to monkeyhammer the company from a B- to a CC rating as a result of Hawker's recent tender offer for its own debt at distressed prices.

Or not. Bill Gross: "Disappointing statement"... Really Bill? One can see the botox losing the fight with the disappointment.

10 Year now at 3.11%

2s10s massively steeper

From Bloomberg:

April 16 (Bloomberg) -- General Motors Corp. is planning to make a formal offer to all bondholders by April 27 to exchange their $27.5 billion in claims for equity, according to a person
with knowledge of the discussions.

GM, facing a June 1 U.S.-backed bankruptcy, was told this week by President Barack Obama’s auto task force to try to restructure its debt out of court, said people familiar with the

Simon Property Group's new "A3/A-" bond issue, which is pricing at a 10.875% yield just got upsized from $500 million to $650 million. Just like the marginal buyers of the MGM 13s of 13 are now very sorry, we smell something quite comparable happening here oh so soon.

In addition to the $261 million loan BWIC reported yesterday by Debtwire, another $233 million BWIC, this time in IG bonds has hit the market. Traders have only until 11 am this morning to submit lowball bids. While loan BWICs over the past month have been increasing rapidly, bond and especially investment grade bonds have not seen wholesale blue light specials yet.