Interest rate spreads are a great tool. These can be easily monitored by anyone, on any of several financial sites; Bloomberg or FT.com are two.
These spreads telegraph change in major world financial dynamics, and far before you’ll hear it on TV. (The media - always last to catch on.)
For example, upon monitoring your spreads this am like a good boy, you were shocked that the Italian 10 yr jumped to a 5.71%, a whole 3% over the German 10 yr. Holy moly! That means that lenders are demanding over double the Ger rate to loan the Italians money. What? Don’t need a PhD to know that’s not a good thing.
You wonder, just how bad will this EU deal get? And by watching spreads, you’ll find out.
So when next in the check out line and a Cosmo buyer’s straight ahead, strike up a discussion. I have a feeling spreads could get trendy!
Robert Craven
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