Credit Default Swaps, ABS Prx, Consumer Confidence and Jobs = Syzygy (look it up)

On Bloomberg today I tracked the prx on 1 year bank CDS index and pricing is around the same as it was in 4Q 2007, which actually shocked me (60 px vs 686 px..the peak).

Also the ABS inventory px has bid up in an accretive way for the past 6 months (and these are legacy HEL deals). Those bonds were trading in the 30’s last year and have more than doubled. The last NPL residential pool traded in the market in the mid 50’s, which is 20 points higher than 8 months ago.

The Dow is a breath from 11000, housing and jobs stabilizing….I am not calling the end of the recession but we are definitely on the “other side of the eye” (for all ya’ll Floridians who have been in a few Category 3’s like me).

Definitely on a positive slope, there is still distressed opportunities (commerical RE, private equity, raw developed land) but biased is toward being long over short (my two cents).