Pay Attention to the $TED spread

The $TED spread is the difference between the 3 month LIBOR rate and the 3 month T-Bill rate.  The TED spread is a proxy for perceived inter-bank credit and liquidity risk. As you can see, in 2008-09 the TED spread ballooned as credit markets locked up and liquidity dried up.
Today, the $TED spread stands at its highest level since 2009.  Additionally, the volatility in the spread is increasingly getting jiggy as the steepness of the ascent sharpens.  The why’s, what-fors, and how comes are way above my pay grade but I can say for sure it is not a data point that can be ignored.

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