Both Treasuries and CMBS are absorbing high volumes ($61 Billion in Treasuries this week w/$3-$5 Billion in CMBS being marketed). So the market’s ability to absorb the issuance with small rises in yields shows bullishness. Treasuries hit a high not seen since late July, 2.54% today, however, bid to cover ratios indicated healthy demand. The general can be attributed to a “rethinking” of last week’s disappointing job report (another “anomaly”?), a lack of concern over global issues (including the unforeseen global economic consequences of Scotland independence ie; potential currency issues), and European bond yields coming up from their recent rock bottom rates….. CMBS issuers have become more aggressive as spreads have tightened slightly, new full leverage loans are being quoted at 190 over Swaps today for a 4.60% coupon. …..stay tuned… David R. Pascale, Jr.
