Saturday, July 12, 2008

What's the cost of US Credit?

20bps!

Yesterday, when the market was tanking, where were the bids for US Govt. paper? In a panic, don't people clamor for some "risk-free" assets?

Instead long term government bonds went down.

While the cost of credit default swaps on US Paper moved from 11bps to 20bps.
http://accruedint.blogspot.com/2008/07/maybe-its-another-drill.html

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