For the time being, I’d say we are in a “Goldie Locks” market, not to hot, not to cold, but just right

13 billion of these puppies crossed the block to yield 4.77% with 36.8% going to Indirect bidders.  Direct bidders took 25.5% as well.  The bid to cover was 2.73 to 1, respectably against the average of 2.50 to 1.  The only drawback was that the issue produced a 1 basis point tail, something on the order of a bulldog or a pug.  Not bad overall, give it a grade of B.  Market reaction was a quick rally back to the day’s best levels, only to reverse in short order to where we repriced.  Currently, the 10 year note is down 3/32’s (yield 3.88%), mortgage backs are unchanged, and stocks have gone positive on both the Dow and the Naz.  Good news is that the selling of late is moderating.  Not so good news is that we do not see a catalyst to rally the market.  For the time being, I’d say we are in a “Goldie Locks” market, not to hot, not to cold, but just right.  Best to keep both hands on the wheel.

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