Monday, June 1, 2009

2s10s30s Breaking Out

The PPT is now hiring a specialist who will overhaul the trading system, and be able to buy both SPOOs and 10 Years at the same time. The current infrastructure allows for the purchase of just one of the two at a time. Today, it's not the 10 Year.

Also, the spread of the 10 year (which is getting pounded as is) to the 30 year mortgage is again on fire. Although as Goldman has $200 billion of follow on offerings still left to price, we will likely see 8% mortgages before the "buyers" in 10 Yr/30 Yr FNMA appear out of nowhere.

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