There’s a scuffle about a Greek default:
European Central Bank officials ruled out a Greek debt restructuring, clashing with political leaders over a solution to the sovereign financial crisis.
“A Greek debt restructuring is not the appropriate way forward — it would create a catastrophe” because it would damage the banking system, ECB Executive Board member Juergen Stark said today in Lagonissi, Greece. Fellow board member Lorenzo Bini Smaghi said in Milan that “a solution for reducing debt but not paying for it will not work.”
Now, I will not claim that I’m the world’s greatest scholar on the debt crisis, but that seems to me to be the first official admission that the purpose of the various bail-outs is to save the banks. Anybody have anything both earlier and more explicit?
More gloomy punditry on US housing:
More than half U.S. homeowners and renters say housing won’t recover until at least 2014, reflecting a deepening pessimism about the real estate market, according to a survey by Trulia Inc. and RealtyTrac Inc.
The survey, taken in April, found that 54 percent of respondents don’t expect a recovery for at least three years, up from 34 percent in November, the two real estate data companies said today. Those who see a turnaround by the end of next year fell to 15 percent from 27 percent.
The housing market is weakening as near record-low interest rates and falling prices fail to boost demand after the expiration of a federal tax credit for homebuyers last year. Values will come under more pressure as 1.8 million properties that are delinquent or in foreclosure are added to the inventory of unsold homes, according to a March estimate by CoreLogic Inc., a real estate information firm in Santa Ana, California.
The iPad has been extraordinarily disruptive:
The iPad is wreaking havoc on the personal-computer market.
Hewlett-Packard Co. (HPQ)’s consumer PC sales plunged 23 percent last quarter, and the company lopped $1 billion off its annual sales forecast. And while rival Dell Inc. (DELL) beat analysts’ estimates because of corporate demand, its sales to consumers slumped 7.5 percent. More than 70 million tablets like the Apple Inc. (AAPL) iPad will be sold in 2011, a total that will balloon to 246 million in three years, Jefferies & Co. said yesterday.
You don’t need a full-blown computer to use eMail or look at dirty pictures on the internet!
There’s sales parties, sure. And then there’s REALLY GOOD sales parties!
A Munich Re unit hosted about 20 prostitutes at a Budapest party to reward the insurer’s high- performing agents, a spokesman said.
…
Ergo hosted the party for about 100 guests at the historic Gellert spa, Handelsblatt reported in a preview of an article to be published today. Women wore color-coded armbands, the newspaper said, citing unidentified guests, with red for hostesses, yellow for those available for sexual favors and white for women reserved for executives and top agents. After each trip to beds set up near the thermal baths, a woman would receive a stamp on her forearm, the paper reported.
And, just to get even further off topic, The Periodic Table of Videos is a great website!
It was a sharply mixed day for the Canadian preferred share market, with PerpetualDiscounts winning 20bp, FixedResets losing 17bp, and DeemedRetractibles ahead 11bp. The Performance Highlights table is more interesting than usual, but still nothing like the glory days of late 4Q08 / 1Q09, which will be treasured in my memory for as long as I still have one.
PerpetualDiscounts now yield 5.51%, equivalent to 7.16% interest at the standard equivalency factor of 1.3x. Long Corporates now yield a little under 5.4% (maybe I should say, a little over 5.35%), so the pre-tax interest-equivalent spread is now about 180bp, about the same as reported on May 11.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.1638 % | 2,456.6 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.1638 % | 3,694.6 |
| Floater | 2.45 % | 2.25 % | 41,160 | 21.63 | 4 | 0.1638 % | 2,652.4 |
| OpRet | 4.88 % | 3.60 % | 61,442 | 1.15 | 9 | -0.0301 % | 2,418.7 |
| SplitShare | 5.23 % | -1.74 % | 56,975 | 0.58 | 6 | -0.0765 % | 2,506.1 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.0301 % | 2,211.7 |
| Perpetual-Premium | 5.74 % | 5.51 % | 127,951 | 0.85 | 9 | 0.0110 % | 2,064.7 |
| Perpetual-Discount | 5.50 % | 5.51 % | 120,382 | 14.56 | 15 | 0.1969 % | 2,159.5 |
| FixedReset | 5.15 % | 3.28 % | 198,675 | 2.88 | 57 | -0.1704 % | 2,307.5 |
| Deemed-Retractible | 5.16 % | 4.95 % | 309,083 | 8.09 | 53 | 0.1104 % | 2,126.4 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| FTS.PR.H | FixedReset | -1.55 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2015-07-01 Maturity Price : 25.00 Evaluated at bid price : 25.40 Bid-YTW : 3.78 % |
| BMO.PR.J | Deemed-Retractible | -1.14 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.30 Bid-YTW : 4.85 % |
| GWO.PR.G | Deemed-Retractible | 1.10 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.78 Bid-YTW : 5.43 % |
| IAG.PR.A | Deemed-Retractible | 1.89 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 22.69 Bid-YTW : 5.89 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| CM.PR.H | Deemed-Retractible | 71,328 | TD crossed 45,200 at 24.99. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.99 Bid-YTW : 4.86 % |
| GWO.PR.N | FixedReset | 64,427 | TD crossed 58,900 at 24.75. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.62 Bid-YTW : 3.95 % |
| SLF.PR.D | Deemed-Retractible | 49,067 | TD crossed 20,200 at 21.75. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.93 Bid-YTW : 6.14 % |
| FTS.PR.E | OpRet | 47,400 | Nesbitt crossed 45,600 at 26.75. YTW SCENARIO Maturity Type : Call Maturity Date : 2013-07-01 Maturity Price : 25.75 Evaluated at bid price : 26.75 Bid-YTW : 2.78 % |
| BNS.PR.M | Deemed-Retractible | 44,623 | TD crossed 24,800 at 24.40. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.37 Bid-YTW : 4.86 % |
| RY.PR.P | FixedReset | 41,400 | Nesbitt crossed 40,000 at 27.10. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-03-26 Maturity Price : 25.00 Evaluated at bid price : 27.05 Bid-YTW : 3.23 % |
| There were 32 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| BNA.PR.E | SplitShare | Quote: 24.35 – 24.80 Spot Rate : 0.4500 Average : 0.2828 YTW SCENARIO |
| ALB.PR.B | SplitShare | Quote: 22.31 – 22.59 Spot Rate : 0.2800 Average : 0.1782 YTW SCENARIO |
| GWO.PR.N | FixedReset | Quote: 24.62 – 24.85 Spot Rate : 0.2300 Average : 0.1388 YTW SCENARIO |
| PWF.PR.M | FixedReset | Quote: 26.70 – 27.00 Spot Rate : 0.3000 Average : 0.2170 YTW SCENARIO |
| BAM.PR.P | FixedReset | Quote: 27.52 – 27.81 Spot Rate : 0.2900 Average : 0.2132 YTW SCENARIO |
| MFC.PR.B | Deemed-Retractible | Quote: 22.26 – 22.52 Spot Rate : 0.2600 Average : 0.1901 YTW SCENARIO |
[…] the pre-tax interest equivalent spread is now about 190bp, a sharp widening from the 180bp reported May 18, as yields have moved in opposite […]