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January 2010

3PM Bond Indicatives

Curve US2Y US5Y*OC US7Y US10Y US30Y Maturity 1/31/2012 12/31/2014* 12/31/2016 11/15/2019 11/15/2039 Coupon 0.875 2.625* 3.25 3.375 4.375 Spot Rate 0.90 2.370* 3.11 3.63 4.55 Est Px 99.951 101.184* 100.865 97.912 97.161   Spreads Bps 2s5s 147 2s10s 273 2s30s 365 5s10s 126 5s30s 218 10s30s 92

Post FOMC

Curve US2Y US5Y US7Y US10Y US30Y Maturity 1/31/2012 12/31/2014 12/31/2016 11/15/2019 11/15/2039 Coupon 0.875 2.625 3.25 3.375 4.375 Spot Rate 0.88 2.37 3.10 3.62 4.44 Est Px 99.990 101.184 100.927 97.992 97.319 Spreads Spreads Bps 2s5s 149 2s10s 274 2s30s 366 5s10s 125 5s30s 217 10s30s 92

FOMC Results

No change, most special liquidity facilities to expire in February. Economic activity has strengthened slightly, labor seems to be stabilizing. Employers remain reluctant to hire. Bank lending continues to contract. No change in A-MBS schedules. Not really any change in the statement.   Below is the verbatim text of the …

New Home Sales

342K vs My Forecast 350K, consensus forecast 372K… Is this like The Price Is Right? What do I win, Bob Barker?                         (Dec)    (Nov)    (Oct) Sales At Annual Rate   342,000   370,000   408,000 Percent Change         -7.6%      -9.3      4.3 Northeast               40,000    28,000    33,000 Midwest                 43,000    73,000    56,000 South                  178,000   192,000   224,000 West                    …

1/27/10 Morning Notes

Key Events Today 10:00AM ET New Home Sales – consensus 372K, previous 355K. My forecast: 350K Tim Geithner Speaks in DC – AIG Inquiry 2:15 PM ET FOMC Statement I expect that the rates will stay the same (so does pretty much everyone else out there). I do not expect …

1/26/10 Bond Close

Bond prices on the short end of the curve remained largely unchanged after the 2Y auction [results]. The interest rate for the new issue was 0.88%, which was in my forecast range, and 8 bps higher than where we were this morning. The old WI (now the OC) has the …

Nice One, CBO

Releasing the FY2010 budget deficit number right during the melee around Consumer Confidence. It didn’t slip our eyes. The FY 2010 budget deficit is projected to reach 1.3 Trillion USD. Update: FY2011 deficit projected at 980B On the newswires attached to the story: Steny Hoyer urges Pay As You Go …