Friday's action saw the intraday reversal I expected. While the volume on the upside has been light, so has the volume on the downside. The market is showing remarkable resilience. Sellers have been relatively reluctant and buyers cautious. So where are we?
The VIX is still very elevated. The TED spread has fallen to about 191 basis points. The TED spread is now down 275 basis points in two months. The 2-year swap spread is up 2.95% to 104.75 basis points.
The Libor-OIS spread is falling 5.88% to 162 basis points.
The 10-year TIPS spread, a good gauge of inflation expectations, is down 8 basis points to .15%, which is down 247 basis points in about five months and at the lowest level since Bloomberg record-keeping began in August 1998. The 10-year TIPS spread bottomed at .65% in October 1998 during the Asian financial crisis and at 1.24% in October 2001 during the technology bubble-bursting meltdown.
The 3-month T-Bill is yielding .01%, which is unchanged.
1-Month USD-based LIBOR has plunged 83 basis points over the last five days to 1.04%, which is a big positive.
The tech sector led Friday.
The main disappointment on Friday was the volume. But as I already mentioned it's also been lower on the downside, so I don't want to read too much into that.
Overall, it seems like we're moving in the right direction, but a lot of work still needs to be done. I suspect we'll revisit the lows of November, but I don't see it happening until sometime early next year.
Did anyone watch the History Channel Saturday night? They had a special entitled:
Crash: The Next Great Depression
Since I only saw it just the one time I can't recall everything that was discussed, but the one thing I did come away with was that we don't appear to be making the same mistakes that were made 78 years ago. That's a general comment as I realize there is room to debate and that there are still parallels to then and now, but overall things are much different today. If they decide to show it again I highly recommend checking it out.
The VIX is still very elevated. The TED spread has fallen to about 191 basis points. The TED spread is now down 275 basis points in two months. The 2-year swap spread is up 2.95% to 104.75 basis points.
The Libor-OIS spread is falling 5.88% to 162 basis points.
The 10-year TIPS spread, a good gauge of inflation expectations, is down 8 basis points to .15%, which is down 247 basis points in about five months and at the lowest level since Bloomberg record-keeping began in August 1998. The 10-year TIPS spread bottomed at .65% in October 1998 during the Asian financial crisis and at 1.24% in October 2001 during the technology bubble-bursting meltdown.
The 3-month T-Bill is yielding .01%, which is unchanged.
1-Month USD-based LIBOR has plunged 83 basis points over the last five days to 1.04%, which is a big positive.
The tech sector led Friday.
The main disappointment on Friday was the volume. But as I already mentioned it's also been lower on the downside, so I don't want to read too much into that.
Overall, it seems like we're moving in the right direction, but a lot of work still needs to be done. I suspect we'll revisit the lows of November, but I don't see it happening until sometime early next year.
Did anyone watch the History Channel Saturday night? They had a special entitled:
Crash: The Next Great Depression
Since I only saw it just the one time I can't recall everything that was discussed, but the one thing I did come away with was that we don't appear to be making the same mistakes that were made 78 years ago. That's a general comment as I realize there is room to debate and that there are still parallels to then and now, but overall things are much different today. If they decide to show it again I highly recommend checking it out.
