Nov 13. Ten year auction today, Yellen hearing tomorrow
–Atlanta Fed’s Lockhart said yesterday that he would like to see movement toward the 2% inflation target before tapering… Inflation is “stable but too low”. His case wasn’t helped by commodities yesterday as crude oil, gold, silver and copper declined to levels last seen in early August. Dec Crude is around 93, having traded 108 in mid-August. Good for energy consumers; maybe lower gas prices will offset the effect of surging health insurance rates!
–Ten year auction today. Yellen confirmation hearing on Thursday.
–Though there was a downside bias in interest rate markets yesterday, with tens up another 2 to 277, there was a seller of about 15k Jan bond 128 puts which was an exit, as open interest fell 8k.
–Muni finance continues to get increased press. Reuters has a piece about a small CA town considering bankruptcy and Fitch notes in their recent downgrade of Chicago that if the city was to properly fund its pension system, property taxes would have to rise by 136%.
–Interesting item in American Prospect; “In 1960, the three biggest private-sector employers in the US were Ford, GM and AT&T. Today, the three biggest private-sector employers in the US are Walmart, Yum Brands and McDonalds.” http://prospect.org/article/40-year-slump
–Good ZeroHedge piece comparing current environment to 1936-37, with similar Wall Street Journal articles: http://www.zerohedge.com/news/2013-11-12/7-more-years-low-rates-and-then-war
