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The best stat to go on is here: http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP:IND http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP:IND It gives y

The best stat to go on is here: http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP:IND http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP:IND It gives you a rough idea of the health of the credit markets. TARP actually helped quite a bit, but it's been inching up over the past few days (up==bad) at the same time the markets have been going up. "Suckers' market" is what I think, and yet I made a few conservative purchases. Safe money remains firmly on the treasuries. Here's the only thing I know: Nobody knows. The more important the chart is (like the DJIA) the more it represents prophecy than reality.

DenisM 18y ago
Thanks for the chart, I learned something new today. Looking at the five year chart I wouldn't call today's situation normal. TED spread is at 2 now and it's been at 4.5 at the peak of the crisis, at 1 throughout last year and at 0.5 before that. Better than worst, but worse than any other recent time since 1987. Much of the interbank trust sits on the health of the mortgages, and whether the worst in there is priced in or not is unclear. I have couple of arguments towards the worst being still ahead - a) while subprime ARMs are over, option ARMs have not begun to reset yet[1] b) mortgages issued later in the bubble were of lower quality than early mortgages(accroding to my common sense) c) it's unclear when synthetic mortgages come due - it's possible that they have already fallen apart (hence the acute crisis of trust) or they might be the last shoe to drop. And treasuries are only secure if dollar is secure. The recen run-up in dollar has no fundamnetals behind it other than delveraging, so once that's over it's bound to tank pulverising the real wealth stored in the treasuries. It's a fun time - I can't think of any safe assets right now. [1] see chart in here: http://www.marketoracle.co.uk/Article5047.html http://www.marketoracle.co.uk/Article5047.html

DenisM 18y ago

Thanks for the chart, I learned something new today. Looking at the five year chart I wouldn't call today's situation normal. TED spread is at 2 now and it's been at 4.5 at the peak of the crisis, at 1 throughout last year and at 0.5 before that. Better than worst, but worse than any other recent time since 1987. Much of the interbank trust sits on the health of the mortgages, and whether the worst in there is priced in or not is unclear. I have couple of arguments towards the worst being still ahead - a) while subprime ARMs are over, option ARMs have not begun to reset yet[1] b) mortgages issued later in the bubble were of lower quality than early mortgages(accroding to my common sense) c) it's unclear when synthetic mortgages come due - it's possible that they have already fallen apart (hence the acute crisis of trust) or they might be the last shoe to drop. And treasuries are only secure if dollar is secure. The recen run-up in dollar has no fundamnetals behind it other than delveraging, so once that's over it's bound to tank pulverising the real wealth stored in the treasuries. It's a fun time - I can't think of any safe assets right now. [1] see chart in here: http://www.marketoracle.co.uk/Article5047.html http://www.marketoracle.co.uk/Article5047.html