Income Issues Trade Near Record Highs

Prices of virtually all income securities were trading very close to record highs at Fridays close–preferreds and exchange traded debt within just basis points of new highs, REITs at new highs and MLPs a couple percentage points off of a new high number.

The 10 year treasury traded down–and as we expressed last week we see no obvious reason why rates would spike hgher anytime soon.  No one believes the ‘hot’ economy story and money all over the world is looking for a reasonably safe spot to hide out.

This week we have retail sales and housing starts as key numbers–although in the end we don’t see these as likely market moving numbers.  The most likely big market moving events would come out of Europe as they did last week with Portugal banks–Europe (excepting Germany) remains a basketcase.

Our model remains in good shape with YTD gains closing in on 10%.  We are not movitvated to do much with the model, except we are pondering the possible purchase of the new FX Energy 9.25% Convertible Preferred issue that may start trading this week.  Beyond this we are sitting tight.