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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (22752)	12/2/2004 1:11:04 PM
From: ild	Read Replies (1) \| Respond to of 110194

NEW YORK (Dow Jones)--While other fixed-income markets fret about a possibly decline in interest from Asian investors, agency debt still appears to enjoy strong support. The proof comes with Freddie Mac (FRE)'s latest bond sale, a two-year reference note priced Thursday. Of the $3 billion offered, 40% was purchased by Asian investors. That's the highest percentage ever registered for a five-year issue by the federally chartered housing finance company. Freddie hasn't sold five-year reference notes since June 2, when Asian investors purchased just 20% of the $3 billion issue. The last time the agency issued reference notes of any maturity was Oct. 13, when it sold $4 billion of two-year paper. But Asian investors took up just 33% of the total. ..... Freddie's latest five-year issue was priced at 99.755 to yield 4.054%, or 30.5 basis points more than five-year Treasurys.

To: ild who wrote (22752)	12/2/2004 1:19:28 PM
From: mishedlo	Respond to of 110194

ILD, I am curious as to what opinion Heinz thinks is reasonable. Saudi selling from its own reserves perhaps? Any way to track that down? Normally it is obvious as to what he is responding to but in this case I do not know. Thanks Mish -------------------------------------------- Heinz on oil and gold Date: Thu Dec 02 2004 12:35 trotsky (Aurum@China aviation) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved this sounds actually quite reasonable. i say this because speculators actually were not net long crude anymore, so a liquidation of spec longs ( as suggested on the ever helpful CNBS ) is not really a credible explanation for the drop. that said, the relatively mild weather certainly has helped with distillate inventories, plus we have an inventory build in crude related to the tax treatment of such inventories ( i.e. it should disappear come January ) . Saudi Arabia's actual output appears to have been well below the promised volumes over the past quarter ( plus it's mostly heavy sour that no-one wants anyway ) , and some have suggested that they're actually unable to boost output, but have instead been selling crude from their own storage. if that's true, then this drop is likely a fake-out. of course, eventually the coming global slowdown should crimp demand growth.