Does Treasury bedlam beckon?

The cost of US credit-default swaps is currently at 80 basis points, up from 10 bps at the start of the year. Potential gain is 55x that of the cost to enter into the trade.

March 10, 2023 . 12:37 AM

1 min read

US credit-default swaps are trading at about 80 basis points, up from about 10 bps at the start of the year.
Net notional has spiked in USA CDS to levels seen only prior to 2015.
Implied probability of a US government default is much lower this time due to lower CTD price.
One-year USA CDS has spiked to levels reminiscent of the debt ceiling stand-offs in 2011 and 2013.
Potential gain is 55x that of the cost to enter into the trade.