S&P: "Ben, We Got Your Back"

Yes, no, maybe.

S&P has reversed the downgrades on several of the CMBS deals where actions were taken last week, after "refining the methodology [it] uses to assess the impact of losses and recoveries resulting from our 'AAA' rating scenario for U.S. conduit/fusion commercial mortgage-backed securities (CMBS).""

upgrades today:
GSMS 2007-GG10 (A2, A3 and AAB) back to AAA from BBB-
MSC 2007-IQ16 (A2 and A3) back to AAA from A+
CSMC 2007-C3 (A2 and A3) back to AAA from BBB+

Today's Macro Question

The white line is the Journal of Commerce Industrial Commodities Index.
The green line is the S&P500.
The orange line is the Real-USD cross.
The pink line is the Real - Renminbi cross.

NFPs vs ISM Non-Manufacturing Business Employment

What exactly are we talking about day-to-day?

Mauss wrote of primitive society repaying itself with the false coin of magic. The metaphor of money admirably sums up what we want to assert of ritual. Money provides a fixed, eternal, recognisable sign for what would be confused, contradictable operations; ritual makes visible external signs of internal states. Money mediates transactions; ritual mediates experience, including social experience. Money provides a standard for measuring worth; ritual standardises situations, and so helps to evaluate them. Money makes a link between the present and the future; so does ritual. The more we reflect on the richness of the metaphor, the more it becomes clear that this is no metaphor. Money is only an extreme and specialised type of ritual.

In comparing magic with false currency Mauss was wrong. Money can only perform its role of intensifying economic interaction if the public has faith in it. If faith in it is shaken, the currency is useless. So too with ritual; its symbols can only have effect so long as they command confidence. In this sense all money, false or true, depends upon a confidence trick. The test of money is whether it is acceptable or not. There is no false money except by contrast with another currency which has more total acceptabilty. So primitive ritual is like good money, not false money, so long as it commands assent.

Mary Douglas, Purity and Danger, 1966

Find the original on Google Books - this passage starts on p.88.

Swaption Vol & Fannie Curr Coupon

Too Big to Fail

Eumenes, perceiving they despised one another, and all of them feared him, and sought an opportunity to kill him, pretended to be in want of money, and borrowed many talents, of those especially who most hated him, to make them at once confide in him and forbear all violence to him for fear of losing their own money. Thus his enemies' estates were the guard of his person, and by receiving money he purchased safety, for which it is more common to give it.

- Eumenes, as told by Plutarch

For the full story, click here.

WaMu Credit Card Master Trust Excess Spread