Replies to post #85814 on Langlui's Big Board and Options Plays

[langlui]

CHART OF THE DAY: Wall Street's Gravy Train Is About To Hit A Brick Wall
Joe Weisenthal and Kamelia Angelova | Feb. 19, 2010, 3:15 PM

The major banks are loving the uber-steep yield curve that allows them to borrow money on the cheap, and then lend it back to the government at a fat yield.

Well, that's just about over. Bernanke has signalled the beginning of the rate-hike cycle (driving up the cost of short-term borrowing) and as this historical chart of the 2year-10-year yield spread (via Waverly Advisors) indicates, the curve just can't get any steeper.

In fact if history is any guide, it's about to collapse big time.