Illinois Still Has a Higher Default Probability Than Spain, Argentina is Third on List (8/29/2012)

Distressed Volatility is back using the retro blogspot url, for now. My domain was somehow lost, jacked, and parked at GoDaddy even after I paid to renew it on Google Apps two months ago. Hopefully it will be back up soon. Below are links to interesting financial articles and a snapshot of CMA's "highest default probabilities" list (based on sovereign credit default swaps), which showed Illinois one-upping Spain. This happened on May 11 as well. Will Spain's default probability % ever pass Illinois? It is interesting that Argentina is third on the default probability list. The country is dealing with high inflation and energy issues related to the government's economic policies.

Fed Chairman Ben Bernanke will probably move the markets on Friday when he gives his Jackson Hole speech. U.S. index futures are down 0.30%, Japan's NIKKEI index is down 1.08%, and the Shanghai Composite is down 0.34%.

Source: CMA (CPD = Cumulative Probability of Default)

Rajoy Seeks Support For Spain Debt As Regions Line Up For Aid (Bloomberg)
Catalonia's €5bn plea brings Spanish bailout nearer (Guardian)
S&P lowers Illinois credit rating over pensions (Businessweek)
S&P lowers Illinois’ credit rating ($84 billion unfunded pension liability) (Chicago Sun Times)
Brazil to lower rates as growth slowly gains traction (Reuters)
Argentina inflation: shoot the messenger (Financial Times/beyondbrics)
Consumers remain uncertain in spite of increased net worth (SoberLook)
The US housing market is not "a chicken-and-egg problem" (SoberLook)
It's the demographics, stupid (on the housing recovery and rents) (Sober Look)
As HELOC Delinquency Rates Hit A Record, Are Student Loans Next? (Zero Hedge)
23% of all U.S. home sales during Q2 were foreclosures or bank-owned (RealtyTrac)
Carl Icahn’s CVR Energy Tactics Are Already Paying Off (DealBreaker)
Part of Bill Ackman's Investor Letter On $900M Markdown of JC Penney (Business InsiderNew York Post)
Outfoxed Bill Ackman tries to guard mall henhouse (Reuters)
Why Bernanke Won't Unleash QE3 At Jackson Hole (Forbes)
Gross Says QE3 Likely Even If Bernanke Doesn’t Provide Hint (Bloomberg)
Hedge Ads Get Green Light (WSJ)
Occupy Sets Wall Street Tie-Up As Protesters Face Burnout (Bloomberg)
Lexmark Credit-Default Swaps Surge to Record on Inkjet Sale Plan /and the stock spikes? (Businessweek)
The Movie Flop That Sank a Michigan Town (bond interest draining $20M general fund) (Businessweek)

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