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Sure, so I am not really prepared to buy it here. Maybe when/if the dividend cuts happen, so that people who are in it for the wrong reasons get washed out. As a result, when/if it gets quite a bit cheaper, I'll be poised and ready.

But that's a short with a pretty punitive negative carry... I am thinking of getting long if it gets sufficiently cheap, having briefly discussed it w/some mtge peeps.

ralph, this is interesting, no? http://www.businessweek.com/news/2011-12-22/gundlach-steers-clear-of-mbs-reits-as-homeowners-refinance.html I would like to know when the right time to get involved is.

It is true... Nobody shops in Switzerland these days and this is based on what a whole bunch of people who live there have told me.

Well, seeing as how this is a discussion on a trading website, in an Economics forum, I naturally assumed that the participants would be following the recent news, developments, etc. Clearly, you're one participant in this discussion that isn't on top of stuff. Would you like me to point you...

Yeah, it's the usual setup, i.e. the LTRO rate is indexed to the refi, basically.

Huh? The Chinese have been devaluing successfully for how long now? There is no inherent short-term limit to how much a CB can devalue, if it's truly willing...

Yep, it's a reasonable guess... Some of the new ECB measures also didn't apply to this tender (more eligibility of collateral, decline in the required reserve ratios, etc) , but will apply to the one in Feb. So it's possible that the one in Feb will actually see more participation.

Actually, if you have reasonably large amounts of money with a custodian (e.g. BONY or State St), you can place it in FDIC-insured accounts. It will cost you, however.

But how do you define the length of this acceptable "emergency" period? No matter how you slice it, the West, including the US of A, is undergoing a massive deleveraging. That is not a rapid process by any means. As to the pension/insurance issues, that's an entirely different kettle of...

Yes, it is, in fact, an attempt to offset or, rather, mitigate the immediate effects of the massive deleveraging that is occurring throughout the European economies.

Not really, but they never intended to drain the liquidity injected through the LT/MROs. They're intentionally looking to obtain the same result that they got with the previous 440b 1y LTRO, i.e. depress the effective O/N rate (EONIA) well below the headline refi rate. It's an extra stealth...

It has all sort of costs associated with it, without a doubt. But yeah, I do believe it's appropriate for certain circumstances.

Well, in this particular case, the reason was that the SNB was doing massive trades in the FX fwds mkt where it was paying banks to borrow CHF from it. So the implied mkt rate went negative.

Excess reserves are going to go up (not by €500b, but rather more like €200b, given the other tenders rolling off)... The excess liquidity in the Eurosystem is going to go up to arnd €470b and is likely to depress the overnight rate, which is something that they would welcome as a sneaky...

Why not? And yes, bonds at 0% can actually be less costly than holding cash (for example, recently cash yields went a little negative due to the cost of FDIC insurance)...

The CHF LIBOR fixing has actually gone negative for a few days this year (not 3M).

Wrong wrong wrong! The most consistently profitable trader known to man is Chuck Norris, obviously.

+1

Also, if this is a quoted article, where's the attribution to the source? A link would be nice...