Goodbye Eurodollars (thanks Libor manipulators/cheaters) hello Broad Treasuries Repo Financing Rate

B

bathrobe

This will take a while but the libor scandal has sadly made it so the most liquid contract in the world will be no more. I used to trade GE daily and then moved on to other contracts when it became utter crap. I don't see it recovering sadly. The new contract is being developed and will be available on the CME early 2018.

http://www.automatedtrader.net/news...ures-and-options-on-the-replacement-for-libor

http://www.automatedtrader.net/news/at/157741/us-chooses-treasury-repo-rate-to-replace-libor

I am very sad, I love the GE and GE spreads.
 
I just can't picture LIBOR being replaced any time soon as a benchmark - everybody and everyone in the world uses it as a reference point for financing and credit.

It's the juice that gets quoted on LIBOR that makes life spicy. I guess EONIA and REPO might be alternatives, who knows...
 
bone said:
I just can't picture LIBOR being replaced any time soon as a benchmark - everybody and everyone in the world uses it as a reference point for financing and credit.

It's the juice that gets quoted on LIBOR that makes life spicy. I guess EONIA and REPO might be alternatives, who knows...
More...

Repo ironically, would be the easiest to manipulate.
 
DeltaRisk said:
Very interesting you say that.

I've worked on a desk for a PD.
Repo trades are at the will of PD's, not mutual funds or hedgies.

You could scream FED FED FED, but you would be wrong in every instance.

They're cleared by banks that have interests in the rates, as you know, there isn't many.

BNY and JPM both have offsetting desks for that exact reason.
More...
Repo trades come in all shapes and sizes... The money mkt fund industry is one of the biggest users of repo, especially after the reform took effect.

Point is that, unlike other rates, there are actual trades and there are lots of them. By definition, this makes the rates obtained from the repo mkt better than LIBOR (no transactions, just arbitrary estimates) and FedFunds/OBFR (too few transactions).

I have no idea why I would scream anything.

And it's just BONY now, btw. JP is out of the repo clearing biz.
 
You must log in or register to reply here.
Back
Top