Saturday, February 14, 2009

TED spread has come down

We may well have passed the storm eye and Q4 2008 may well be the worst quarter in this cycle. But I don't see the light at the end of the tunnel. The recovery is not in sight and it will be slow and gradual, if any.

1-year Ted spread:

3-year Ted spread:

(click to enlarge; source: Bloomberg)