Good Morning Everyone and Happy Monday!  It is Monday, and we are positive once again in equity markets across the board, even though the gains are slight, and volume is lethargic.  Only 250M shares have been exchanged on the NYSE as of this writing, that’s about ¼ what we would normally see by this time of the day.  There are no economic news releases to move the market one way or the other.  Equity markets are just drifting sideways and will probably do so the rest of the day. 

However, such is not the case in credit markets.  We are getting hammered once again. Pretty much all this month we’ve been drifting higher in rates.  This is due in most part to the unrelenting rally of the stock market.  We’re expecting the stock market to hold on to it’s gains through the end of the year, but recouping some of our losses in credit markets back in early 2010.

There is an auction of 2 year Treasuries happening today, the results of which will be released today.  This could help rates a little.  The dollar is weaker today, giving rise to the equity markets.  Oil is up once again, and gold is slightly down, once again.  We did get some good news on Christmas Eve from the Treasury Dept who vowed to lift the cap of how much it will spend to keep Fannie Mae and Freddie Mac around, at least for the next 3 years.  I don’t suspect the Feds can lift rates any time soon, as this, along with the tax credit expiring, would have monumental impact on any hope of a housing recovery.  We’ll have to wait and see.