Dec 16. The Spartans’ stand at Thermopylae

“Here did four thousand men from Pelops’ land
Against three hundred myriads bravely stand”

The poet Simonides’ inscription at the pass of Thermopylae to honor Leonidas and the Spartans.


Above is a graph of the red/gold eurodollar pack spread (2nd year vs 5th year contracts).  In 2009, 2010, 2011 and twice in 2013…in all these instances 300 has stood against the invaders.  However, going into this Fed meeting, the level is destined to fall, especially if a reduction in bond buying is announced.  (Today’s close of just under 295 uses EDZ’14 as the the first red, but the new red pack has EDH’15 at the forefront, and the spread is just over 298).  There ought to be a disbelieving scramble to cover, as risk managers step forward to force exits at ridiculous levels going into year end.

Posted on December 16, 2013 at 7:40 pm by alexmanzara · Permalink
In: Eurodollar Options

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