Friday, September 26, 2008

CDS report: Big Mac and fried in the US

The US has been so hurt by the financial turmoil that markets now view its credit worthiness as akin to - or even worse than - that of McDonald’s, a shocking fact even if you believe that both are fronted by clowns.

One broker quoted McDonald’s CDS at about 26.5 basis points, compared with 30bp for the US, on Friday morning and another desk quoted both about 25bp. The picture has worsened since the news that politicians and public servants in Washington failed to seal a financial bail-out deal on Thursday night. McDonald’s closed at 28bp versus 25bp for the US on Thursday, according to Markit.