April 7. Fraying at the edges
Portugal finally admitted it needed a bailout just as the ECB is about to raise rates. In the US, the USDA is expanding access to the food stamp program, already at record use, as a gov’t shutdown looms.
From Gonzolo Lira’s blog: “It’s not merely that the disparity between the wealthy and the rest of the population is obscene—the disparity skews the results. Remove the top 15% of the population, and the avg income in the United States drops below Slovenia’s—and no, I’m not kidding.” [Of course, if one removed even the top 1% of Slovenia’s population, I’m sure the results would change dramatically]. Fraying at the edges continues, and that’s why Bernanke is so concerned about weakness in employment growth.
–Ten year note surpassed 3.50% ending at 3.54 yesterday. The curve is steepening due to inflationary impulses from commodities. New highs in one year eurodollar calendar spreads, with EDH12/H13 edging out to 146. (the widest one year spread).
–Japan’s nuclear woes continue, news item in HuffPost says the focus has now shifted to “preventing explosions”. Though there’s money being pumped in for rebuilding efforts, the loss of output and confidence throughout the region is likely to continue…yen made new recent lows yesterday.
