Everything is up except Bob - sorry the EURO...

Sort of strange market this a.m, with EUR under pressure while stock market is making new highs - so not only Gold but also EUR is at odds with its long-term correlations... of risk on and off - either this means EUR situation getting more serious, and hence a need for further correction - or it is symbol of further rotation into the US away from Europe?

Either way we took out 1.3450 ish and saw new lows in this cycle - last move came on Fitch downgrading Portugal.

http://www.marketwatch.com/story/portugal-downgraded-to-aa-by-fitch-2010-03-24?siteid=bnbh

Morgan Stanley seems to think this is the start of further erosion of developed market vis-a-vis EMG:
http://www.businessinsider.com/morgan-stanley-developed-nations-will-have-sovereign-downgrades-2010-3

Another game changer 10yr vs swaps below 0:  http://ftalphaville.ft.com/blog/2010/03/24/185091/new-negative-territory/

Our models performed like this:

Inflation: - 30 bps (MTD: -30 bps)
Benchmark: +39 bps (+67 bps)
Inv. Bk 60/40: +30 bps (+67 bps)
Doom-and-Gloom: -88 bps (-225 bps)
Macro Old Style: -24 bps (-179 bps)