With global equities markets down 2-3% overnight, we're opening with wider spreads this morning.  The rumored increased Chinese stimulus package was just that....rumored.

The UK today gave us some good news and some bad news.  Aviva, an insurer, reported a heavy loss which sent the FTSE down pretty dramatically.  On the positive side, the Bank of England announced that it would be purchasing bonds (both gov't gilts and some corporates).  I suspect many eyes will be watching this program to see if it works and whether it would work over here.  This is in addition to a rate cut.

The recent TALF program to rejuvenate the ABS market has heretofore been met with positive response.  The WSJ did a good job explaining how it will work yesterday here.  We're now starting to see more pundits offering their counter opinions before it's even been implemented.

Ford announced what is likely to be only the first proposal of it's debt tender.  Ford bonds were higher on this news and credit default swaps rallied.  Naturally, debtholders were vehement in their desire for better terms.  

In Warren Buffett's annual letter, he mentions 4 times how 2009 will be lousy for his different lines.    

I find it very ironic that Standard and Poor's is now calling for rating agency reform.  They were the ones that assured us that a basket of risky, but uncorrelated assets, were deserving of AAA ratings.  Don't get me wrong, I'm a firm believer in caveat emptor....however, they should stick to fundamental credit research and not correlations.

The new issue market should be quiet today given equity weakness and spreads.