While the U.S. Treasury’s current capital needs are undeniable, its just-announced Q4 fund-raising plans are epochal. Is it trying to fully pre-finance current plans, knowing full well that yields are going to rise as struggling U.S. creditors find other, higher uses for the same capital over the coming months?

With news tonight that Treasury is once again looking at expanding the list of companies in which it takes equity stakes, I have to confess to shaking my head a little. According to the WSJ, Treasury is mulling taking stakes in “bond insurers and specialty finance firms such as General Electric Co.'s GE Capital unit, CIT Group Inc. and others”.

So, now it’s banks, insurance firms, bond insurers, and miscellaneous finance firms. With auto companies almost certain to get bailed out eventually, remind me again who’s not on the list.

More here.

As an aside, the piece also tips that Paulson has now largely abandoned the original TARP toxic auction scheme in favor of equity injections and, to a much lesser degree, direct asset purchases.

The first detailed public credit default swap data release is imminent. It’s coming later today (Tuesday) at around 5pm EST via DTCC. The clearinghouse says it will, on a weekly basis, put out data on the top 1,000 credit default swap contracts. The figures will be for both company and country swaps, and it will also split out about notional and net obligations.

Keep you eye out for the new data here.

In case people hadn’t noticed, levered ETF companies are planning to turn the volume up to eleven. We are seeing a new class of triple-levered ETFs launched, with the idea that you will get triple the daily return of the underlying index, depending on whether you bought the short or the long variant.

Now, levered ETFs aren’t new. We have had long and short index ETFs for some time, as well as double-levered such things too. But the rise of triple-levered ETFs at a time when volatility measures are doing moonshots strikes me as unusual, at best, and possibly marking a new source of market risk.

Granted, the current assets aren’t massive, but these levered products are sizable. Their impact can also be considerably larger given the underlying leverage, and given how retail investors can be buy levered ETFs with … well, leverage.

Some quick and cursory data that I put together that I think is fairly striking on asset growth at some of the more popular levered ETFs. In particular, I was intrigued by how much more popular the double-levered variants of such things are –- people wants their volatility in big chunks, apparently.

It has become more or less predictable now in presidential cycles (and I've been guilty of playing along now and then too). We mine presidential election cycles to come up with historical predictors of which presidential choice will be best for the markets over the next four years, next few months, next ten minutes, etc.

We are told the best presidential returns come during Democratic administrations. Or we see that the Dow usually turns in positive numbers from the election to the end of the year. Or that when a Democrat president is elected the Dow, on average, declines through the end of the year. Or that when a Republican is elected the Dow usually gains through the rest of the year. And then there are more specific variants, like what happens to year-end in a Democratic sweep of the Congress and the Executive Office, or a split, with a Republican presidency and a Democratic sweep of Congress.

Such are the perils of our data-drenched times, and the entire exercise is mostly a waste. While there is no denying presidents can affect markets, and that electing, say, Mao or maybe Mussolini would really irritate capital markets (I think), for the most part markets simply want the entire exercise over with so that they can get on with doing their usual fluctuating thing.

But what about the data?! Isn't it true that Democratic presidents have delivered the best returns? Isn't it true that returns to end-of-year are better under new Republican presidents than new Democratic presidents?

All true. But the empirical issues are myriad. For starters, we have a teensy sample size. There have been 28 presidential administrations in the U.S since 1900, 12 of which were Democratic and 15 Republican. That is already giving us small-ish numbers from which to extrapolate anything. The situation gets worse, however, if we make it all post Depression and post-WWII, which is arguably a good idea. Then we're down to 15 administrations, six of which were Democratic and nine of which were Republican. That is, to a first approximation, a data set of size zero -– especially if you then begin slicing things up further to see what happens when you have a Democratic sweep (which, if you're curious, takes you down to a sample size of four since WWII.

If teensy sample sizes were the only issue, that might be almost forgivable. But we also have variance problems. Consider that the average return from election day to end of year under incoming Republican presidential administrations is 4.1%, while –1.0% under Democrats. That's impressive, right? Not really. The standard deviation of returns is 8.3% under Republicans and 5.3% under Democrats over the post-election period. In other words, it is entirely possible, statistically speaking, the returns are actually the same –- or that maybe Democrats do better. We just don't know enough to know.

Bottom line: Extrapolating much of anything useful from presidential data is entertaining, but a waste of time for everyone but the pundits who get to fill some air time with pseudo-scientific yapping.

[The data in this post came from a host of sources, including Yahoo Finance, Wikipedia, Bespoke Premium, and my own prior posts on the subject.]

I’m having oodles of fun playing with the new credit default swap data. Just to get things started, here are the top ten registered CDS by net (not gross) notional exposure.

Apparently the future of the financial world hinges on Italy and Spain not defaulting. Who knew?

[via DTCC’s new weekly CDS update]