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Argentina tries to avert default - again 27 Aug 2013 | 09:45 pm
Last week the US appeals court ruled in favor of the NY-law bond houldouts (a group of bondholders who did not participate in the swap some years back when Argentina defaulted), forcing Argentina to m...
Putting recent treasury losses in perspective 27 Aug 2013 | 10:01 am
The histogram below shows the total return of long-dated treasuries over a rolling 4-month period since 2007. The rationale for using a 4-month period is that the climb in long-term rates started 4 mo...
Speculative treasury positions are now net short and growing 27 Aug 2013 | 08:58 am
Speculative money has become visibly short rate products. As discussed this weekend (see post) there still seems to be a broad bearish sentiment on treasuries - in spite of the massive selloff. The ch...
A steeper VIX futures curve 27 Aug 2013 | 01:27 am
One helpful risk indicator worth tracking is the steepness of the VIX futures curve (see description). In particular the spread between the December and the September futures provides a measure of ris...
Soy, corn futures spike on scorching Midwest weather 27 Aug 2013 | 12:17 am
Here we go again. While the early part of the US Midwest summer has been fairly benign for crops, farmers' luck has run out in late August. The central part of the US is experiencing a broad heat wave...
Emerging economies sought semi-hot money through currency manipulation 26 Aug 2013 | 09:23 am
As we look across major emerging economies, even some of the strongest have not been spared. Consider Turkey for example. The lira is now toying with the 2-to-the-dollar level - even after the central...
Can the Fed's proposed overnight facility reduce pressure on the repo markets? 26 Aug 2013 | 07:00 am
Repo rates in the US have seen sharp declines this year and are currently at levels not seen since 2011. There are several reasons for this decline: 1. Excessive liquidity in the financial system (i...
Is the treasury sell-off overdone? 25 Aug 2013 | 11:57 am
ETF Trends recently published an article called "Treasury ETFs: The Ultimate Contrarian Trade" (here). It seems that from the near-term technical perspective, treasury yields may have peaked. That is ...
The end of cheap US cash claims another victim: Indonesia 25 Aug 2013 | 05:26 am
In a fashion similar to what became known as the "Asian Contagion" in the late 90s, the current stress in emerging economies has been spreading. One of the nations to experience financial stress recen...
Some expect the political game of chicken to keep the Fed on hold in September 25 Aug 2013 | 01:57 am
The sell-side research community remains divided over the timing of the Fed's first securities purchase program reductions. While economists almost universally believe tapering will begin this year, t...
