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I have no idea if credit is tight. When I was a working stiff I had
access to every economist and statistic on the street. You might
want to take a look a Grant's interest Rate Observor. I used to
always read that. Junk bond yields have basically been going up
since 98 and haven't exactly bounced yet. Haven't been following
commercial paper yields and haven't been able to follow swap spreads
either. The Bloomberg site has 10yrBB2/Treasuries and those spreads
have blown out by over 100bp over the past 3 months. But by the
looks of it, appears to me the money is all funneling into mortgage
refis and consumer credit. Maybe the housing bubble is only getting
started here.
--- In realtraders@xxxx, STUART AUSLANDER <u.stuart-auslander@xxxx>
wrote:
> Bruce
> Does that mean money is tight now in the USA because comercial and
industrial
> loans are crashing along with commercial paper.
> Stuart
>
> bruce.larson@xxxx wrote:
>
> > The Fed injects liquidity by buying back mainly short
treasuries. So
> > now the banks are sitting on alot of cash. The only way this is
> > distributed through the system is if the banks are willing to lend
> > this excess cash out and if borrowers see leveraged investment
> > possibilites. Japan loosened in the 90s but it didn't do the
> > domestic economy any good because domestic borrowers were
perceived
> > uncreditworthy. I'm sure the borrowers and investors were already
> > drowning in a tide of debt and stock market losses. Initally the
> > liquidity went offshore to Southeast Asian ventures which pretty
much
> > all bit the dust. Now all the money is parked in long Japanese
> > government bonds which last time I looked yielded about 1.4%.
Who in
> > their right mind would buy long-term debt in the world's most
> > indebted nation suffering through a severe recession and doing
> > everything it can to weaken its own currency? Better off putting
> > your money under a mattress.
> >
> > --- In realtraders@xxxx, profitok <profitok@xxxx> wrote:
> > > Hello
> > > Attach is the latest m3 money supply as reported by the fed
> > > ----- Original Message -----
> > > From: "STUART AUSLANDER" <u.stuart-auslander@xxxx>
> > > To: <realtraders@xxxx>
> > > Sent: Monday, October 01, 2001 10:05 PM
> > > Subject: [RT] Adjusted Reserves Sept 19, 2001
> > >
> > >
> > > > Adjusted reserves of the banking system which have varied
from 60
> > to 70
> > > > billion for the last 3 years(except during Y2K) grew from 68
bil
> > on
> > > > September 5 to 107
> > > > billion on September 19. (These are the Fed StLouis measures
of
> > the
> > > > required reserves need by the banking system to support their
> > > > deposits.) I would say the FED has taken out all the stops
and
> > intends
> > > > to dramatically stimulate the economy with money.
> > > >
> > > > It is my feeling (I would love feedback on this) that money
has
> > been
> > > > tight despite declining interest rates. Declining interest
rates
> > do not
> > > > necessarily make money loose. I suspect we have just seen a
major
> > > > change in FED policy.
> > > >
> > > >
> > > > To unsubscribe from this group, send an email to:
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> > > >
> > > >
> > > >
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> > > >
> > > >
> >
> >
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> >
> >
> >
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