Can QE save the Euro?

After sustaining long disagreements with German leaders, the European Central Bank finally announced Draghi’s victory with QE to be launched in Europe. QE in the Euro would witness bond purchases of 60 Billion Euros per month for at least a horizon of 19 months in addition to the existing scheme of purchasing 10 Billion Euros with covered bonds. The programme marked its official debut in Europe on March 9th however the markets had begun pricing in the much anticipated measure sending bond yields falling and average deposit rates hovering around the zero lower bound.

Bond modeling test help

Hello fellow monkeys,

I just got a modeling test for a DCM role. I will finish it after work tonight and was hoping someone would be willing to check it over quickly. Anyone willing to help?


Private Placement Information

When private companies issue commercial paper or bonds in a private placement and Moody's issues a rating on the PP, how can we find out what the yield on the placement is?

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FI Trading Down?

What do you guys think is driving FI trading profits down at the big banks? Seems to me across the board the BB's have decreased..

An ERP Retrospective: Looking back (2014) and Looking forward (2015)

Mod Note: This was originally posted on 1/2/15 on his blog "Musings on Markets"

At the beginning of 2014, the expectation was that government bond rates that had been kept low, at least according to the market mythology, by central banks and quantitative easing, would rise and that this would put downward pressure on stocks, which were already richly priced. Perhaps to spite the forecasters, stocks continued to rise in 2014, delivering handsome returns to investors, and government bond rates continued to fall in the US and Europe, notwithstanding the slowing down of quantitative easing. Commodity prices dropped dramatically, with oil plunging by almost 50%, Europe remained the global economic weak link, scaling up growth became more difficult for China and the US economy showed signs of perking up. Now, the sages are back, telling us what is going to happen to markets in 2015 and we continue to give them megaphones, notwithstanding their  forecasting history. Rather than do a standard recap, I decided to use my favored device for assessing overall markets, the equity risk premium (ERP), to take a quick trip down memory lane and set up for the year to come.

How would you convince your Client that a "higher" yield bond does not really give a higher yield?

Saw this question on an interview guide but had no answer.

Does it have to do with the relation between the nominal yield and the current yield? Or is it relating to YTM?

Best book on bonds?

Hi all,

Investing in bonds in a rates hike environment

Out of interest, is there any way to invest in bonds in an environment when US rates will be rising?