Archive for the ‘Eurodollar Options’ Category
May 5. Stocks unresponsive to lower rates, lower dollar
May 5. Service ISM much weaker than expected at 52.7 vs 57. The economy appears to be losing steam, and treasury yields are falling in response. Tens fell to 3.22% with fives firmly under 2% at 1.93%. –Employment report tomorrow. Today Jobless Claims expected 410k. –If the economy IS slowing, and stocks are no longer […]
May 4. Five year note below 2%?
May 4. US yields remain remarkably low and are edging even lower, with the 2 year note at only 59 bps and tens at 3.25%. The backdrop could be the beginning of a leveraged commodity washout, with silver, having neared $50, down almost 20% in a couple of days. –I marked 2/10 treasury spread at […]
May 3. A good day for America
–Obama called the death of Bin Laden a “good day for America” and I agree. Good. That’s all. Commentators were on tv implying this news might give a boost to the US, perhaps even economically. In a world of 15 minute news cycles I would tend to strongly disagree. It’s ten years after the fact, […]
April 29. Le deluge
Tennessee Williams: Mendacity is a system that we live in. Liquor is one way out and death’s the other. –I suppose I should write about large euro$ option trades from yesterday, the buy of 100k EDZ 9900/9925/9950p fly for 2.0 or the sale of 100+k EDH2 9937/9950c spd for 8 (new position). And while those […]
April 28. Precious metals surge after FOMC
–Two days ago Geithner said the US has a strong dollar policy. At yesterday’s press conference Bernanke said the Fed wants to keep inflation low which should help support the dollar. OJ said he wants to find his wife’s killer. –The market gave its opinion, suggesting a loss of credibility for official pronouncements, as the […]
April 27…first FOMC press conference on tap
Looking back at the last FOMC statement from 15 March, the Fed noted generally firmer economic conditions, with weakness in housing, and concern about “a sharp run-up in oil prices”. However, inflation expectations “have remained stable” and the “Committee expects these effects to be transitory….” The question is whether things have changed much in Bernanke’s […]
Oil and speculators
Obama is vowing to take ‘speculators’ to task over the increase in oil prices. Over Easter weekend family visits, one of the first topics to come up was the oil market with my sister in law asking me if speculators are indeed to blame for the recent price surge. I said maybe they’re a factor, but so is […]
April 26. No bond sellers. ‘You can be bearish, just don’t be short’
–Interest rate futures rose Monday on light volume, with new lows in several near eurodollar calendar spreads. For example, EDZ1/EDZ2 fell 5.5 bps to settle at 113.5. There were weekend reports that China intends to dramatically cut its dollar reserves. This news (along with anticipated end of QE2), should have been negative for bonds, and […]
April 21. New highs gold, silver, stocks…
New high gold. New high silver. Crude surged by $3 bbl. New high stocks, new low dollar. Implied vol getting crushed. New low VIX. –The eurodollar curve edged to new recent high. Red/green pack spread rose 3.375 bps to 118. Still quite low for one year spreads… –From ZH post, Texas Teachers Pension fund needs […]
April 19. S&P downgrades US outlook on debt concerns
Here’s an explanation for the S&P downgrade of the US outlook: It comes time to review the US, but S&P is short on analysts because the smart ones (anxious to avoid the possibility of incarceration) have flown the coop after the subprime debacle. Being short staff, SVP Smith hands the job to VP Johnson, who […]
