July 5. Ten year note yield rose another 4 bps to 3.20 on Friday.
July 5. Ten year note yield rose another 4 bps to 3.20 on Friday. Calendar spreads in eurodollars all made new highs, with most one-year spreads having bounced 20-30 bps over the past 2 weeks.
–S&P warned that the Greek bond rollover plan may still be deemed a default. I think the following quote is from the Daily Mail…”Incredibly, the average salary on Greece’s railways is £60,000, which includes cleaners and track workers – treble the earnings of the average private sector employee here.The overground rail network is as big a racket as the EU-funded underground. While its annual income is only £80 million from ticket sales, the wage bill is more than £500m a year — prompting one Greek politician to famously remark that it would be cheaper to put all the commuters into private taxis.”
–When I first read that the NY Fed was suspending sales of Maiden Lane assets related to AIG, I didn’t think it was such a big deal; mostly I thought it was sign of fragility in markets. However, spreads related to these types of risky assets rallied on the sale suspension, and I suspect some of the sell off in treasuries was a consequence spread unwinding.
–Factory Orders expected +1.0%.
