LIBOR Treasury spread

by

Thanks to the banking crisis, the spread between LIBOR and Treasuries has widened to 1.5% (it’s normally closer to 0.5%). As Brad de Long puts it, “the odds that any given major bank borrowing Eurodollars will collapse tomorrow have gone from something that you expect to happen roughly once every 3000 years to once every 500 years.”

Advertisements

2 Responses to “LIBOR Treasury spread”

  1. Michael Keefe Says:

    Greenspan’s Conundrum involved persistantly low long term rates whereas Bernanke’s Conundrum is the spread between LIBOR and Treasuries.

  2. Rod Funk Says:

    Please recommend a book that explains how a savings bank
    can make money from opening the door forward.
    Rod Funk

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s


%d bloggers like this: