The trend continues to be your friend.

Stocks were positive with the S&P stock index +0.4% higher as treasury bonds sold off.

Corporate credit spreads continue to grind in tighter with the trend likely to see the IG (investment grade) CDS (credit default swap) index set new tight prints.

Savvy players are wary getting short against the trend.

Cash bonds out-performed relative to CDS with secondary flows getting bid on and new issues snapped up and oversubscribed.

Dallas Fed Chief Richard Fisher, an eloquent advocate of sustainable growth, gave a talk titled "A Need for Innovative Fiscal Policy: With a Nod to John Stemmons, Ronald Reagan, and Paddy McCoy."

Fisher underlines the limits of monetary policy as a salve for the nation's fiscal mess and calls on Congress to step up to the plate; the transcript is worth reading.

Congress should work overtime to study what went right with the Reagan years.

There is buzz about paring down government support for Fannie Mae and Freddie Mac; the agency landscape could change substantially.

Across the Atlantic, Germany is pushing Bundesbank Chief Axel Weber, an inflation hawk, to take over Trichet's spot at the ECB (European Central Bank) when he steps down.

The London Stock Exchange is in talks to potentially merge with Canadian TMX in a ₤4.2 billion transaction.

M&A (mergers & acquisitions) action continues in the U.S. with the Pritzker family (an old backer of Obama) close to selling Triton Container to Warburg Pincus and Vestar for $1 billion.

Oil and natural gas explorer Chesapeake Energy is looking to raise around $5 billion to pay down debt as it looks to sell shale natural gas assets.

Chesapeake sold $1 billion of 10 year debt at +241; unbelievably tight levels for "junk" debt.

General Electric Capital Corporation sold $2 billion of 10 year subordinated notes at +162.5.

Ally Financial (formerly GMAC) sold $1.25 billion of debt.