Friday Stuff

Things no one cares about except @Conorsen and me.

Treasury Bill rates look like this: 3m -.26. 6mo - .41. 1 year - .51 and 2 years at .76.

The 5 year is around 1.10 and the 10 year is 1.53. 1o year rates should be an extrapolation of 1 year rates into the future with various adjustments for coupons, day counts, forwards, futures and convexity.

3 month LIBOR set at .77 sending an old metric known as the TED spread out again. The 12 month rate (the rate we watch that fits nicely far enough away from the FF gravitational pull and  fills the gap until the 2 yr note) hit a new high of 1.47%. The 3 month set was 66 a month ago, when pundits began to count days and shrug off regulatory changes, and a paltry 30 one year ago today. Rates are falling I am told by the WSJ and the TV.

By next week, it is quite probable that 12 month "money" will be within a gnat's whisker of the 10 year government note rate. Ponder for a second the chasm between dollar interbank and many DM negative yielding "tax contracts." One has to wonder, how can the price of money be so high and debt yield so low? Considering that quantitative monetary policy is used to make the distinction between money and debt evaporate, what has gone wrong? More importantly, why are Conor and I the only 2 people who seem to care?

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