{"id":14066,"date":"2011-02-11T19:58:14","date_gmt":"2011-02-11T23:58:14","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=14066"},"modified":"2011-02-11T19:58:14","modified_gmt":"2011-02-11T23:58:14","slug":"february-11-2011","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=14066","title":{"rendered":"February 11, 2011"},"content":{"rendered":"

There is one problem with directing tax revenue to debt reduction: it means you can’t spend it. EU plans are running into roadblocks<\/a>:<\/p>\n

Greece joined Italy in objecting to annual numerical debt-reduction targets in a fresh challenge to the German-led drive for tougher economic safeguards to underpin the euro.<\/p>\n

Greece, the first deficit-riddled euro country to fall back on financial aid, says the proposed rule would force it to make impossibly large cuts once its support package runs out in 2013, according to a draft of European Union legislation.<\/p>\n

\u201cAll member states except two already accepted the proposal,\u201d said an EU briefing note obtained by Bloomberg News before next week\u2019s debate among finance ministers. \u201cItaly and Greece have a reserve on the numerical benchmark.\u201d<\/p>\n

Greece or Italy alone could veto the rule, undercutting the tougher enforcement demanded by Germany as a condition for beefing up the 750 billion-euro ($1 trillion) rescue fund for distressed states.<\/p><\/blockquote>\n

Assiduous Readers will remember it was France and Germany who scuttled the 3% deficit rule when it was no longer convenient to them.<\/p>\n

The Fannie & Freddie problem is lurching towards the limelight<\/a>:<\/p>\n

U.S. Treasury Secretary Timothy F. Geithner presented Congress with a set of options for weaning the $11 trillion mortgage market from its dependence on the government, while calling for changes to be phased in \u201cresponsibly and carefully\u201d to avoid economic disruptions.
…<\/b>
The options suggest differing degrees of government involvement in the system. The most dramatic would involve a \u201cprivatized\u201d system of housing finance, with a government role to help \u201cnarrowly targeted\u201d low-income and veteran buyers.<\/p>\n

A middle ground would replace Fannie and Freddie with a system that helps low-income and veteran buyers in normal times and also provides an expanded guarantee that the government could ramp up in a crisis. The paper suggests using high-priced guarantee fees or restricted amounts of public insurance to achieve this goal.<\/p>\n

A third option has the biggest government role and would hew closest to the current system. It would impose more regulation and give the government a role in \u201ccatastrophic reinsurance behind significant private capital,\u201d so as to provide a backstop in times of crisis.<\/p><\/blockquote>\n

We have a wee bit of xenophobia happening<\/a>:<\/p>\n

Ontario Finance Minister Dwight Duncan has turned up the heat in the political debate surrounding the proposed transatlantic stock-exchange transaction, saying he does not want a \u201cstrategic asset\u201d owned by the Middle East.<\/p>\n

\u201cWe do business with the Middle East,\u201d Mr. Duncan told reporters at Queen’s Park on Friday. \u201cI am just not sure I want them owning our stock exchange.\u201d<\/p><\/blockquote>\n

Then buy it yourself – jerk. He doesn’t even have the “finite natural resource” excuse. Seems to me that if a foreign-owned TMX stops doing its job properly, then there are a few Alternative Trading Systems that would be pleased to pick up the slack. Or somebody will write the code to start up a new one. But I guess Duncan thinks Canadians are too stupid to do that.<\/p>\n

It was a quiet day on the Canadian preferred share market, with PerpetualDiscounts up 1bp, FixedResets down 6bp and DeemedRetractibles gaining 5bp. Volatility was small and volume was muted.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.0477 %<\/td>\n2,393.9<\/td>\n<\/tr>\n
FixedFloater<\/td>\n4.78 %<\/td>\n3.50 %<\/td>\n19,654<\/td>\n19.08<\/td>\n1<\/td>\n0.0440 %<\/td>\n3,557.8<\/td>\n<\/tr>\n
Floater<\/td>\n2.50 %<\/td>\n2.28 %<\/td>\n46,655<\/td>\n21.56<\/td>\n4<\/td>\n0.0477 %<\/td>\n2,584.8<\/td>\n<\/tr>\n
OpRet<\/td>\n4.82 %<\/td>\n3.64 %<\/td>\n61,182<\/td>\n2.23<\/td>\n8<\/td>\n0.0966 %<\/td>\n2,390.0<\/td>\n<\/tr>\n
SplitShare<\/td>\n5.31 %<\/td>\n1.11 %<\/td>\n299,217<\/td>\n0.83<\/td>\n4<\/td>\n-0.2748 %<\/td>\n2,460.7<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.0966 %<\/td>\n2,185.4<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.74 %<\/td>\n5.39 %<\/td>\n118,092<\/td>\n1.24<\/td>\n9<\/td>\n0.0171 %<\/td>\n2,035.6<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n5.55 %<\/td>\n5.59 %<\/td>\n132,911<\/td>\n14.40<\/td>\n15<\/td>\n0.0113 %<\/td>\n2,109.6<\/td>\n<\/tr>\n
FixedReset<\/td>\n5.24 %<\/td>\n3.69 %<\/td>\n171,992<\/td>\n3.05<\/td>\n54<\/td>\n-0.0561 %<\/td>\n2,263.0<\/td>\n<\/tr>\n
Deemed-Retractible<\/td>\n5.21 %<\/td>\n5.21 %<\/td>\n410,268<\/td>\n8.28<\/td>\n53<\/td>\n0.0537 %<\/td>\n2,080.0<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
BNA.PR.E<\/td>\nSplitShare<\/td>\n-1.20 %<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2017-12-10
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.60
\nBid-YTW : 5.29 %<\/td>\n<\/tr>\n
PWF.PR.I<\/td>\nPerpetual-Premium<\/td>\n-1.02 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2012-05-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.25
\nBid-YTW : 5.39 %<\/td>\n<\/tr>\n
IAG.PR.A<\/td>\nDeemed-Retractible<\/td>\n1.11 %<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 22.80
\nBid-YTW : 5.79 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
RY.PR.E<\/td>\nDeemed-Retractible<\/td>\n47,760<\/td>\nTD crossed 29,900 at 23.76.
\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 23.75
\nBid-YTW : 5.11 %<\/td>\n<\/tr>\n
TD.PR.E<\/td>\nFixedReset<\/td>\n46,611<\/td>\nDesjardins crossed 38,000 at 27.07 … possibly related to TD.PR.S, below?
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-05-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 27.06
\nBid-YTW : 3.74 %<\/td>\n<\/tr>\n
TD.PR.S<\/td>\nFixedReset<\/td>\n40,415<\/td>\nDesjardins crossed 38,000 at 25.85 … possibly related to TD.PR.E, above?
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-08-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.85
\nBid-YTW : 3.69 %<\/td>\n<\/tr>\n
BMO.PR.J<\/td>\nDeemed-Retractible<\/td>\n31,915<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 23.78
\nBid-YTW : 5.10 %<\/td>\n<\/tr>\n
TD.PR.O<\/td>\nDeemed-Retractible<\/td>\n28,898<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.38
\nBid-YTW : 5.20 %<\/td>\n<\/tr>\n
BAM.PR.X<\/td>\nFixedReset<\/td>\n24,490<\/td>\nRecent new issue<\/a>.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2041-02-11
\nMaturity Price : 23.06
\nEvaluated at bid price : 24.90
\nBid-YTW : 4.51 %<\/td>\n<\/tr>\n
There were 29 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n
Wide Spread Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nQuote Data and Yield Notes<\/td>\n<\/tr>\n
FTS.PR.F<\/td>\nPerpetual-Discount<\/td>\nQuote: 23.23 – 23.65
\nSpot Rate : 0.4200
\nAverage : 0.2844<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2041-02-11
\nMaturity Price : 23.03
\nEvaluated at bid price : 23.23
\nBid-YTW : 5.28 %<\/td>\n<\/tr>\n

IAG.PR.C<\/td>\nFixedReset<\/td>\nQuote: 26.71 – 27.24
\nSpot Rate : 0.5300
\nAverage : 0.4132<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-01-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.71
\nBid-YTW : 4.01 %<\/td>\n<\/tr>\n

RY.PR.Y<\/td>\nFixedReset<\/td>\nQuote: 26.95 – 27.30
\nSpot Rate : 0.3500
\nAverage : 0.2366<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-12-24
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.95
\nBid-YTW : 3.93 %<\/td>\n<\/tr>\n

SLF.PR.G<\/td>\nFixedReset<\/td>\nQuote: 25.30 – 25.75
\nSpot Rate : 0.4500
\nAverage : 0.3418<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2015-07-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.30
\nBid-YTW : 4.19 %<\/td>\n<\/tr>\n

BNA.PR.E<\/td>\nSplitShare<\/td>\nQuote: 24.60 – 25.00
\nSpot Rate : 0.4000
\nAverage : 0.2935<\/p>\n

YTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2017-12-10
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.60
\nBid-YTW : 5.29 %<\/td>\n<\/tr>\n

FTS.PR.H<\/td>\nFixedReset<\/td>\nQuote: 25.30 – 25.60
\nSpot Rate : 0.3000
\nAverage : 0.1971<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2015-07-01
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.30
\nBid-YTW : 3.91 %<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

There is one problem with directing tax revenue to debt reduction: it means you can’t spend it. EU plans are running into roadblocks: Greece joined Italy in objecting to annual numerical debt-reduction targets in a …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-14066","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/14066","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14066"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/14066\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14066"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14066"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14066"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}