Spreads are slightly better this morning.  Credit investors seem to have focused on the healthy trading revenues from JPM's release; equity investors seem to have focused on the weak retail banking numbers from same.  Investors will likely applaud their effort today to bring a new 10 year bond issue without the FDIC guarantee.

Moody's has warned that they may downgrade the commercial insurers citing litigation concerns on top of the standard 'investment losses'.  

The Treasury just announced ~$10B will be available to the banks to modify existing 'troubled' mortgages.  I'm told by mortgage traders that this has had little impact on spreads today.

The TARP program is in the news a bit today.  One, it's been noted that bank lending has actually shrunk amongst the banks that received TARP.  While this may surprise some, I'd remind folks that the economy is still shrinking so keeping lending standards prudent/unchanged will lead to less lending.  Also, we're starting to see some backlash against the rapid repayment of TARP loans as it could lead to less government control. 

The SEC seems to have re-focused their energy on revamping the ratings agencies.  "Change is a-coming" here.  Personally, I wouldn't want to own these equities as the oligopoly of Moodys, S&P and Fitch will clearly be diminished in the near future.  Also, expect investors,  rather than issuers, to be paying going forward.   This will lead to ratings volatility as issuers are no longer allowed to ask, in advance, "how can I structure this deal/news so that I keep my ratings?"

One would think that a company or country growing at 6.2% annual clip would be applauded.  However, when it's China and that's the lowest print since 1992, investors worry about it.

New issues continue to perform well at issuance and in the secondary market afterwards.  I've also heard of 'real money' investors delving into buying of off-the-run bonds.  This is an encouraging sign of broadening liquidity.  There's been depth (in new issues) and now there's breadth.