If you read MBS Open and MBS Morning, there is literally not much else to report in terms of prices continuing to exhibit classic behavior associated with the range trade.  As hoped (perhaps even expected?) ,  102-00 has in fact held as MBS support and 3.31 in Tsy's put on an equally strong showing.  Now with Beige book being released, there is a slight deterioration to the perfect regularity of our mini-rally.  4.5's had reached 102-06, unchanged on the day, but have since fallen a scant 2 ticks to 102-04.  10yr tsy was as low as 3.27 but is now threatening 3.30.

It's starting to feel like the "ahead of the curve" reprice for the worse crowd might be getting antsy despite the fact that the range can't be discounted by movements following this Beige book reading.  So although you may see a reprice here, it certainly does not speak to the weekly picture or even the big picture.  Be steadfast in your resolve.  We will let you know the moment the range is broken, if it's broken.

(by the way, we got away from overlaying S&P and Tsy's recently to avoid clutter and confusion, but I wanted you to see the stock lever this afternoon.    In general would you prefer it this way?  or keep em separate except to show the lever?)

Here are some beige book bullets

- Economic conditions have improved modestly since Oct 21 report
- Fed-residential real estate somewhat improved from very low levels; house prices flat or declining modestly
- Commercial real estate, construction very weak, deteriorating in places; expectations for 2010 "very low"
- Banks saw steady to weaker loan demand, tight credit, steady or slipping loan quality
- 8 of 12 districts saw pickup or improvement, remainder saw conditions little changed or mixed
- Labor market conditions weak; Signs of stabilization, scattered improvement
- Some districts saw upward pressure on commodity prices but little or no wage, finished goods price pressure
- Consumer spending picked up moderately for general merchandise, vehicles
- Manufacturing steady to moderately improving across most of country
- Fed beige book prepared at New York Fed with data collected through nov. 20