Friday – May 28th, 2010

  • Greece May Yet Have to Restructure Its Debt: WSJ
  • Bernanke ‘Extended Period’ May Be Curtailed as Credit Improves: Bloomy
  • Congress Weighs a Pension Bailout: WSJ

Being ‘outta pocket’ most of yesterday both helps and hurts. We continue to like things we liked at this same time yesterday even THOUGH risk rally occurred. We’re not 100% with the reasoning – China NOT selling Europe SO BUY USA? We’ve got a (slightly) more in-depth look at ideas we went over yesterday morning – and suffice it to say buying dips, curve flattening and buying here vs there, all seem to still make sense to us. Hamptons Hedge? Maybe. We’d mention couple things in the press just today that KEEP us ‘on the hook’ WSJ story we’ve linked to talks about Congress Weighs A Pension Bailout. Right. We’d ALSO have to mention the most popular WSJ story of the morning being passed like a hot-potato – Greece may still restructure its debt. Remember those 2yr Greek bonds you bought at 15-20% ?? Good times. We would ALSO point out on StreetStuff – MS at it again – another way to SELL – ‘short real yield view by selling 10yr TIPs’. NOW staying on StreetStuff.pdf for a moment – we’d ALSO mention that Goldilocks is much LESS bullish of 10yrs than they had been. WHY? Target of 3.00% ‘ish 10s MET. NOW WHAT? Click it up for more. Finally, we’d like to mention the Technicals.pdf for a moment – a brief update of landscape and positions of the moment: JPM maintains a profitable short in 10s (vs 3.10’ish – well done!!), CSFB reversed short to long (these guys have been on a roll!!), CitiFX asks NOW WHAT – and having taken some ‘bullish chips’ off the table – worth a look and finally, we’d mention that UBS wanting to buy dip (watch out – been cold as ice). TGIF. Have a great start to the end of the week. Regards, Saul/Steve

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