To: Yorikke who wrote (3121 ) 1/10/2001 5:22:57 PM From: John Pitera Respond to Shorter-dated paper may have also been hit by expectations that the Fed will wait until the end of the month FOMC meeting before cutting rates again, and overall, may not be as friendly as initially anticipated. Such speculation have received a bit more play from Market News Fed-watcher, Steven Beckner, Former Fed Gov Angell is said to be looking for a 50 bp policy rate cut on Jan 31 and further ease to a 5% funds rate by mid-year. Angell, now an economist at Bear Stearns, has missed the call in the past but he may have a better feel than the market how Greenspan will play out the current situation. By our assessment a full 100 bp in less than a month seems more aggressive than the gradualist Greenspan style of the past, but the worsening current situation just may call for it. Angell's rationale, surprisingly, is that Greenspan doesn't want to let down the market now pricing in an aggressive 1/2 point move at the FOMC meeting. Angell argues that Greenspan would have to signal the market if only a 25 bp move is planned, something he doesn't believe Greenspan is up to. The corporate calendar is absolutely bulging at the seams right now. The Williams Cos. is on tap for $1 bln worth of 15 and 30-year paper to price as early as today, while Genuity plans to sell $2 bln worth of debt and Telefonos de Mexico (Telmex) plans to sell $1 bln in 5s before the end of the month. In recent trading, the Heller 2-year priced at +174 bp. The size came in at $750 mln, up from $500 mln.
