CREDIT MARKETS
Treasuries:
Treasury prices fell Wednesday, pushing the yield on 10-year notes higher for a fifth consecutive session, as bond traders digested data that showed dramatic private-sector job losses last month as well as a Congressional Budget Office forecast of a much wider budget deficit in store for the federal government. The Treasury Department auctioned a record $30 billion in 3-year notes just after the nonpartisan agency said the government will run a $1.2 trillion deficit for fiscal 2009, up from $455 billion in the fiscal year ended in September. The three year note sale drew a yield of 1.20 percent, the lowest on record. The bid to cover ratio was 2.21, compared with an average ratio of 2.41 at the past 10 auctions. Indirect bidders bought 28 percent of the notes, compared with an average of 27.6 percent at the past sales. Treasuries had a muted reaction to an ADP Employment Services report that said private companies cut 693,000 jobs in December — nearly 50% more than some economists had predicted. The 2 to 10 year yield curve was little changed from yesterday at 1.67 percentage points after widening by 42 basis points from 1.25 percentage points on December 26th.
Municipals:
U.S. municipal bonds prices rose allowing Washington state and other issuers including California and Empire Development Corp to cut yields on their bond offerings. Yields on top-rated general obligation bonds due in 10 years fell eight basis points to 3.77 percent. The 30-year tax-exempt yield dropped five basis points to 5.38 percent, matching the level last seen Nov. 20. The benchmark taxable 10-year Treasury note was higher in yield today by about three basis points at 2.48 percent. Regional bond dealers said it supports President-elect Barack Obama’s proposal to provide a federal backstop for the municipal bond market to free up credit for state and municipal borrowers. Under the proposal, included Federal Reserve and Treasury Department would set up a system to guarantee municipal debt, similar to one for commercial paper. The secondary market was fairly active. I was in touch with MTA 5% 8/19 ata 5.50-5.45, dorms 3.65% ata 99.25-99.50. I was posted on NV 5% 12/11 @ 2.03, NYS Thrwy 5% 4/15 @ 3.00. The read on the MMD was 2010: yields were unchanged; 2011-2012: yields were lowered by 3-6bp; 2013-2022: yields were lowered by 6-9bp; 2023-2029: yields were lowered by 5-8bp; 2030-2038: yields were lowered by 3-6bp.
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Commentary/New Issues

Corporate:
Nothing

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offerin mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets