Bloomberg has a little more speculation regarding the CIT death-spiral:
The Federal Deposit Insurance Corp. is unwilling to guarantee CIT Group Inc.’s bond sales because the commercial lender’s credit quality is worsening, according to people familiar with the regulator’s thinking.
The FDIC, which has backed $274 billion in bond sales under its Temporary Liquidity Guarantee Program since Nov. 25, is concerned that standing behind CIT debt would put taxpayer money at risk, said the people, who declined to be identified because the application process is private.
The federal agency, run by Chairman Sheila Bair, is in discussions with CIT about how the lender can strengthen its financial position to get approval, including raising capital, said one of the people. New York-based CIT’s measures to improve its credit quality, such as by transferring assets to its bank, have been insufficient, the person said.
Comrade Obama is proposing extraordinary powers for the SEC:
The Obama administration is seeking to give the U.S. Securities and Exchange Commission power to prohibit pay practices at brokerages and investment advisers and broader authority to bar individuals from work in the industry.
The Treasury Department today sent Congress legislation that would let the SEC ban “sales practices, conflicts of interest and compensation schemes” deemed harmful to investors. The measure authorizes the agency to remove individuals who violate rules from all aspects of the industry, rather than just a specific segment such as selling securities or managing money.
…
The measure gives the SEC authority to reward whistle blowers who give the agency tips about those violating all securities laws. The SEC currently has power to pay individuals who provide the agency with tips on insider-trading violations.
Super! Paid informers! Just the thing that’s needed to further improve society’s moral fibre!
No response or acknowledgement from MFC regarding my queries on the MLI IT1C issue. What a surprise!
Continued gains, albeit pretty small ones, for preferred shares today. Volume dropped off a bit.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0558 % | 1,155.4 |
| FixedFloater | 7.05 % | 5.42 % | 36,904 | 16.43 | 1 | 0.1299 % | 2,139.1 |
| Floater | 3.30 % | 3.85 % | 76,185 | 17.76 | 3 | 0.0558 % | 1,443.5 |
| OpRet | 5.00 % | -3.78 % | 121,805 | 0.09 | 15 | -0.2696 % | 2,207.5 |
| SplitShare | 6.14 % | 4.68 % | 85,535 | 4.16 | 4 | -0.4563 % | 1,909.3 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.2696 % | 2,018.5 |
| Perpetual-Premium | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0831 % | 1,757.3 |
| Perpetual-Discount | 6.31 % | 6.29 % | 157,676 | 13.46 | 71 | 0.0831 % | 1,618.5 |
| FixedReset | 5.57 % | 4.32 % | 497,852 | 4.29 | 40 | 0.0403 % | 2,062.5 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| BAM.PR.H | OpRet | -1.76 % | YTW SCENARIO Maturity Type : Soft Maturity Maturity Date : 2012-03-30 Maturity Price : 25.00 Evaluated at bid price : 25.10 Bid-YTW : 5.69 % |
| PWF.PR.J | OpRet | -1.69 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2011-05-30 Maturity Price : 25.25 Evaluated at bid price : 25.56 Bid-YTW : 3.85 % |
| PWF.PR.G | Perpetual-Discount | -1.32 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 22.18 Evaluated at bid price : 22.45 Bid-YTW : 6.58 % |
| CGI.PR.B | SplitShare | -1.12 % | YTW SCENARIO Maturity Type : Soft Maturity Maturity Date : 2014-03-14 Maturity Price : 25.00 Evaluated at bid price : 25.51 Bid-YTW : 4.26 % |
| CM.PR.P | Perpetual-Discount | -1.01 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 21.63 Evaluated at bid price : 21.63 Bid-YTW : 6.38 % |
| GWO.PR.F | Perpetual-Discount | 1.39 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 23.08 Evaluated at bid price : 23.33 Bid-YTW : 6.37 % |
| SLF.PR.E | Perpetual-Discount | 1.78 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 17.15 Evaluated at bid price : 17.15 Bid-YTW : 6.63 % |
| RY.PR.C | Perpetual-Discount | 1.90 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 19.32 Evaluated at bid price : 19.32 Bid-YTW : 6.05 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| BNA.PR.D | SplitShare | 130,102 | Recent new issue. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2014-07-09 Maturity Price : 25.00 Evaluated at bid price : 24.91 Bid-YTW : 7.38 % |
| CM.PR.H | Perpetual-Discount | 39,183 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 18.48 Evaluated at bid price : 18.48 Bid-YTW : 6.52 % |
| TD.PR.S | FixedReset | 33,930 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-07-10 Maturity Price : 24.86 Evaluated at bid price : 24.91 Bid-YTW : 4.23 % |
| MFC.PR.E | FixedReset | 33,860 | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-10-19 Maturity Price : 25.00 Evaluated at bid price : 25.65 Bid-YTW : 5.19 % |
| GWO.PR.E | OpRet | 25,221 | RBC crossed 25,000 at 25.75. YTW SCENARIO Maturity Type : Call Maturity Date : 2009-08-09 Maturity Price : 25.50 Evaluated at bid price : 25.75 Bid-YTW : -5.67 % |
| HSB.PR.E | FixedReset | 22,755 | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-07-30 Maturity Price : 25.00 Evaluated at bid price : 27.55 Bid-YTW : 4.43 % |
| There were 31 other index-included issues trading in excess of 10,000 shares. | |||