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Stranger Than Fiction, Part 3


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Truth is Stranger than Fiction

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A guy walked into a little corner store with a shotgun and demanded all the cash from the cash drawer. After the cashier put the cash in a bag, the robber saw a bottle of scotch that he wanted behind the counter on the shelf. He told the cashier to put it in the bag as well, but he refused and said, "Because I don't believe you are over 21." The robber said he was, but the clerk still refused to give it to him because he didn't believe him. At this point the robber took his driver's license out of his wallet and gave it to the clerk. The clerk looked it over and agreed that the man was in fact over 21, and he put the scotch in the bag. The robber then ran from the store with his loot. The cashier promptly called the police and gave the name and address of the robber that he got off the license. They arrested the robber two hours later.

 

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A pair of Michigan robbers entered a record shop nervously waving revolvers. The first one shouted, "Nobody move!" When his partner moved, the startled first bandit shot him.

 

************************************

 

Last summer, down on Lake Isabella, located in the high desert, an hour east of Bakersfield, California, a woman new to boating was having a problem. No matter how hard she tried, she just couldn't get her brand new 22-ft Bayliner to perform. It wouldn't get on a plane at all, and it was very sluggish in almost every maneuver, no matter how much power she applied.

 

After about an hour of trying to make it go, she putted over to a nearby marina. Maybe they could tell her what was wrong.

 

A thorough topside check revealed everything was in perfect working order. The engine ran fine, the outdrive went up and down, the prop was the correct size and pitch. So, one of the marina guys jumped in the water to check underneath. He came up choking on water, he was laughing so hard.

 

(wait for it........)

 

(remember, this is supposed to be true.......)

 

Under the boat, still strapped securely in place, was the trailer!

 

************************************

 

From MountainWings.com ? The Daily Inspirational Email

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So much for the 38.2% retrace on bond yields. We appear to have blown through that this morning. From yesterday (at lower yields and presumably narrower spreads):

 

Thursday July 31, 5:57 pm ET

By Eric Burroughs

 

NEW YORK, July 31 (Reuters) - U.S. swap spreads blew

sharply wider on Thursday, suffering one of their worst weeks

since the 1998 LTCM crisis as the big rise in benchmark yields

had mortgage investors hammering the market with heavy

hedging.

 

Five- and 10-year spreads widened dramatically, by more

than 8 basis points, in what traders described as a market in

which it was increasingly difficult to get trades done and

where dealers are struggling with the overwhelming needs of the

mortgage universe.

 

"This can't go on for much longer because the market can't

take this. Someone's going to get into trouble," said one head

trader at a U.S. bank.

 

Upbeat data showing unexpectedly strong second-quarter

economic growth, better factory output in the Chicago area and

still-declining jobless claims drove up 10-year Treasury yields

and swap rates by as much as 30 basis points during the day,

unleashing the latest round of mortgage activity.

 

Swap spreads came under repeated fire from mortgage

accounts grappling with major extension of the duration in

their portfolios that forces them to adjust quickly, either by

selling Treasuries or doing the equivalent in swaps, paying

fixed rates.

 

The duration dilemma has been compounded because mortgage

security coupons shrank as yields hit 45-year lows, making them

even more sensitive to the nearly 1.5 percentage point jump in

yields in the past six weeks. The selling drives yields still

higher and causes yet more big hedging from the $4.9 trillion

mortgage universe.

 

Everyone from Fannie Mae (NYSE:FNM - News) and Freddie Mac (NYSE:FRE - News) to major banks holding mortgage-backed securities is forced to cut down the rapidly expanding duration, traders said.

"Any mortgage holder is getting demolished here," one trader said.

 

Ten-year spreads shot up an unprecedented 8-1/2 basis

points to 58-1/2 basis points over Treasury yields and are now

nearly 17 basis points higher for the week. Five-year spreads

skyrocketed 58 basis points from 49-3/4 on Wednesday and 40-1/2

last Friday.

 

"The violence of the move has been astonishing," said Eric

Hiller, head of interest rate research at Banc of America

Securities (News - Websites). "Ninety-nine percent of it is mortgage related."

 

Two-year spreads have also been crushed as the stock

market's ongoing gains and optimism on the economy have erased

all remaining hopes for another Federal Reserve rate cut. Some

investors are even thinking about rate hikes. The two-year

spread is out to 28 basis points from 20 late last week.

 

Hiller said the move was not related to credit worries in

the banking system, as sometimes can be the case in the swaps

market. Last year swap spreads popped wider when unfounded

rumors swirled about credit problems at J.P. Morgan Chase.

 

The selling pressure has been relentless this week and has

resulted in spreads suffering their worst widening since the

bond market's last mortgage-related plunge in late-2001 and

even the crisis days of 1998, when the giant hedge fund

Long-Term Capital Management nearly collapsed.

 

Making matters worse for swaps is the hefty widening of

agency spreads on reports the European Central Bank was

trimming its holdings of Fannie Mae and Freddie Mac debt. Both

agency and swap spreads tend to influence and sometimes

reinforce each other.

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Liquidty Measures Shrink!

 

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I'd like to breifly restate forum rules.

 

In general, observe copyrights. Please post only a snippet and a link to copyrighted material. Do not repost any articles in full without the publisher's permission.

 

IDS is for short, trading related posts, news bulletins, and humorous diversions. Longer posts should go on Look Out Below, or other appropriate forum.

 

No attacks on fellow stoolies. If you have a beef with someone, take it up privately via email or private message.

 

No sexist or racist remarks, or ethnic stereotyping. I am cracking down on this stuff as of now. Fair warning.

 

No political comments on this thread. Political comments belong on the Political Stool forum.

 

Moderators are instructed to delete posts which violate these guidelines, after counting to 10 and applying reasonable judgement.

 

If we all follow these simple requests, everyone's experience here on IDS will be enhanced. It's ok to have fun with off topic stuff. Just keep it short.

 

Many tanks!

 

Doc

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