Week of December 4, 2011 thru December 10, 2011

US Hill Still Seeks Way To Extend Payroll Tax Cut,UI Benefits


--Senate Democrats, Republicans Block Rival Plans
--House GOP Calls On Obama To 'Accept' Their End of Year Tax Package
--House, Senate Appropriatiors Try To Craft $900 Billion FY'12 Package

WASHINGTON (MNI) - Another week of testy tactical skirmishing on Capitol Hill has left Congress no closer to an agreement on extending the payroll tax cut, renewing uninsurance benefits, or passing other important end-of-the-year items.

Congressional leaders have said they hope to adjourn for the year by next Friday, but the continuing deadlock on the payroll tax cut extension and other items could this target adjournment date back for at least a few days and perhaps up to a week.

Greece PM: Commission,Eurogroup To Draft Eurobond Plan In Mar


BRUSSELS (MNI) - The European Commission and the Eurogroup will produce a plan in March of next year for jointly-issued "Eurobonds," Greece's Prime Minister Lucas Papademos revealed Friday afternoon.

Briefing reporters following the two-day EU leaders' summit here, Papademos said the plan for such a bond would be within the framework of new fiscal rules being developed by the Eurozone countries and in the context of ongoing deficit reduction efforts by national governments. He said the issue of Eurobonds was discussed by the leaders at their summit.

This would seem to indicate that Germany, which appeared to get its way earlier this week in dropping the Eurobond idea, may not have prevailed on that point afterall.

US$ CREDIT SUPPLY PIPELINE - December 9, 2011


Investment-grade $250M+ Deals Announced/Launched(#)/Priced(*)/Pass(X)

Date $MM Issuer/CR/Descr Mat Yield Lead(s) 12/8 300 *FNFG (Baa3/BBB-) 10 7.25% GS/Sandler Subordinated Notes O'Neill 12/8 600 *Florida Power & Light (Aa3/A) 30 T+115 BAR/C/GS/MIZ/ FMB SCO/WFS 12/8 350 *IEX (Baa2/BBB) 101 CoC Put 10 T+225 BAML/JPM/WFS >>Scroll Down for More More Treasury, Muni & Agency Supply/Calendars Coming Soon Freddie Mac to announce Reference Note Wed, 12/14 and Thu, 12/22

U.S.

Portfolios:Aberdeen Asia FI Cuts HY'til Cmfrtble W/EMU Resltn


WASHINGTON (MNI) - The road to a resolution of the EMU crisis promises to remain challenging at least over the next couple of months, leading Aberdeen Asia Pacific Income Fund's portfolio manager to reduce high-yield exposure until he feels "comfortable with some form of medium-term resolution to the problems in Europe."

US Swaptions: Steady/Bid, 3M-2Y Vol On 5-10Y Tail Support


CHICAGO, Dec 9 (MNI) - Over-the-counter swaption premiums held steady to firmer Friday, 3M to 2Y volatility on 10Y tails gaining.

US$ CREDIT SUPPLY PIPELINE - December 9, 2011


Investment-grade $250M+ Deals Announced/Launched(#)/Priced(*)/Pass(X)

Date $MM Issuer/CR/Descr Mat Yield Lead(s) 12/8 300 *FNFG (Baa3/BBB-) 10 7.25% GS/Sandler Subordinated Notes O'Neill 12/8 600 *Florida Power & Light (Aa3/A) 30 T+115 BAR/C/GS/MIZ/ FMB SCO/WFS 12/8 350 *IEX (Baa2/BBB) 101 CoC Put 10 T+225 BAML/JPM/WFS >>Scroll Down for More More Treasury, Muni & Agency Supply/Calendars Coming Soon Freddie Mac to announce Reference Note Wed, 12/14 and Thu, 12/22

U.S.

US Corporate Bond Chatter: Supply To Dwindle Into Year End


NEW YORK, Dec 9 (MNI) - There was an absence of fresh, investment-grade corporate bond supply Friday, amid a relatively positive, yet cautious, tone in the domestic credit market following the outcome from the two-day EU heads of state summit.

US Corporate Bond Chatter: Supply To Dwindle Into Year End


NEW YORK, Dec 9 (MNI) - There was an absence of fresh, investment-grade corporate bond supply Friday, amid a relatively positive, yet cautious, tone in the domestic credit market following the outcome from the two-day EU heads of state summit.

While no new high grade corporate bond issuance was announced, some sources noted that supply could ramp-up in the early part of next week, if market conditions remain stable.

Investment-grade corporate bond offerings are thereafter likely to turn quiet into year-end as firms seek to limit balance sheet risk, market sources said.

EU Summit Clarifies Fiscal Union But Leaves ECB Role Blurry


By Jack Duffy and Peter Koh

BRUSSELS (MNI) -- European leaders offered a clearer blueprint for a tighter fiscal union at this week's summit, but efforts to assemble greater firepower to confront the Eurozone debt crisis fell short of the European Central Bank bazooka that many had hoped for.

The plan that emerged on early Friday closely followed the road map unveiled by French President Nicolas Sarkozy and German Chancellor Angela Merkel on Monday.

As least 23 EU leaders agreed to submit to a new "fiscal compact" of tough budget rules and automatic sanctions when deficits stray above 3% of GDP. The deal will also require states to submit draft budgets to Brussels, which will have the power to call for revisions.

US Debt Offering, Auction Calendar for Tsy and Agency Issues


December 9

Source: U.S. Treasury, Fannie Mae, Freddie Mac Amounts in billions of U.S.