Yields Fall on AHM News
Action Economics: American Home Mortgage (AHM) filed for bankruptcy protection via Chapter 11 Monday, which seems to be putting U.S. yields under fresh downside pressure, though the new shouldn't really come as a surprise after the firm's lay off of 7000 staff on Friday. That move already contributed to Friday's volatility and stock market swoon, though it certainly is one more nail in coffin of the subprime sector. Investors were also jittery after Bear Stearns (BSC) ousted its President after Friday's CFO declarations of the fixed income crisis being the worst in over 22-years. The crisis-sensitive 2-year yield is probing back under 4.40%, down 4 basis points and the 10-yield is down 2-basis points to 4.68%. The 2s-10 spread is out another couple basis points to +28 bp as curve steepening reigns.
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