Bad news keeps coming. Ruby Tuesday files for bankruptcy

October 7, 2020

–Powell continues to make the case for more stimulus to support the economy.  Pelosi and Mnuchin are in endless talks to bridge the gap.  Trump finally tweets that talks will be halted until after the election.  I don’t know what the exact sticking points are, but federal aid to states for pension problems that have been festering for years is one of them.  Not every mismanaged problem can be solved by throwing more money at it.  Trump’s move is likely just a negotiating ploy, but in any case, the election is just 27 days away.  Stocks took a sharp tumble after Trump’s tweet, but are now bouncing.

–TYZ0 is currently 138-26, close to the lows of the past couple of days, in front of today’s $35 billion ten year auction.  Yesterday tens fell 2.3 bps to 73.7; curve eased from recent gains on Trump’s tweet halting stimulus talks.  Dec US (30 yr) vol retreated sharply on the futures rally as stocks tumbled, to 9.7 from 10.5.  The atm 175 straddle settled 4’50 from 5’10 for the 174 line on Monday.  The fear is on the downside for the long end, and obviously more economic stimulus heightens that fear, whether due to inflation implications or uncontrolled deficits or a combination of factors.  

–VP debate tonight.  Fed minutes this afternoon.  NY Fed chief Williams speaks in the afternoon.  

Posted on October 7, 2020 at 5:26 am by alexmanzara · Permalink
In: Eurodollar Options

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