US Default Protection Surges To Widest Levels Since March
via zero hedge by Tyler Durden on 2/4/10
The fire in the sovereign periphery is slowly moving to the core. Today, US CDS, on which we have been constructive since they hit 20 bps in September, are trading 55/60, or almost 200% "higher." This is the most 5 year US protection has cost since the market lows in March. We anticipate at least another 15-20 bps of widening in US risk absent some dramatic and miraculous improvement in Europe, as existing shorts are forced to cover en masse. As for the "sure buy" out there, it doesn't get any better than German CDS.
