PrefBlog

The SEC is approving a scheme by the NYSE that will discriminate between orders based on who you are:

A Retail Order would be an agency order that originated from a natural person and not a trading algorithm or any other computerized methodology. A Retail Order would be an immediate or cancel order. The Retail Member Organization submitting the order would not be able to alter the terms of such order with respect to price or side of the market. A Retail Order could be submitted in a round lot, odd lot, or partial round lot amounts.
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Under the proposal, a Retail Member Organization submitting a Retail Order could choose one of three ways for the Retail Order to interact with available contra-side interest. First, a Retail Order could interact only with available contra-side Retail Price Improvement Orders. The Exchange would label this a Type 1 Retail Order and such orders would not interact with other available contra-side interest in Exchange systems or route to other markets. Portions of a Type 1 Retail Order that are not executed would be cancelled.

Regrettably, there are no provisions according special status to orders placed by black jewish lesbians. I trust that this oversight will be addressed forthwith.

San Bernardino’s going bust:

San Bernardino’s City Council voted to become the third California municipality this year to seek bankruptcy protection after officials learned they might not have enough cash to pay workers.
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A filing by San Bernardino would follow ones by Stockton, a community of 292,000 east of San Francisco, which on June 28 became the biggest U.S. city to go into bankruptcy. Mammoth Lakes, a mountain resort of 8,200, filed for protection from creditors July 3 saying it can’t afford to pay a $43 million legal judgment, more than twice its general-fund spending for the year.
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Taxable Build America Bonds sold by the San Bernardino Joint Powers Financing Authority in December 2010 and maturing in 2030 traded today at a record average yield of about 11 percent, up from 7 percent yesterday, data compiled by Bloomberg show. General-obligation debt from state and local California issuers yielded an additional 1.04 percentage points above top- grade securities on average as of yesterday, matching the most since Jan. 12, according to Bloomberg Fair Value index data.
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Confronting a $45 million shortfall, San Bernardino is facing insolvency because of accounting errors, deficit spending, pension and debt costs, and lack of revenue growth, according to a June 26 budget analysis posted on the city’s website. Officials have declared fiscal emergencies, negotiated for concessions from employees and reduced the workforce by 20 percent in four years.

I confess to being most interested in the pension section of the city’s tale of woe, which I will not reproduce here because the bastards scanned the report instead of producing something more web-friendly. Basically, retirement costs were 9% of the budget in 2006/7 and are projected to increase to 15% of the budget by 2015/16.

It was an unevenly positive day for the Canadian preferred share market, with PerpetualPremiums winning 21bp, FixedResets up 4bp and DeemedRetractibles gaining 2bp. Two PerpetualPremiums made it on to the three-entry Performance Highlights table. Volume was low.

PerpetualDiscounts now yield 4.94%, equivalent to 6.42% interest at the standard equivalency factor of 1.3x. Long corporates now yield about 4.3%, so the pre-tax interest-equivalent spread is now about 210bp, a tightening from the 220bp reported June 20.

This entry was posted on Wednesday, July 11th, 2012 at 10:55 pm and is filed under Market Action. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.