U-G-L-Y

U-G-L-Y
Merv ain't got no alibi
It's ugly! Hey, hey it's ugly!

If traders were prone to chanting, the above ditty is probably pretty close to what they'd be singing. Respite from the "good news" of AIG's nationalization (or whatever you want to call it) has ebbed pretty quickly as markets come to grips with crippling cash shortages in a range of currencies. December short sterling, for example, has traded down as low as 18.5 ticks from last night's close...quite a stunning reversal from recent price action.

Having wiped out a number of US firms, markets now seem to be focusing on taking down UK banks. Macro Man has replaced AIG with HBOS on his screens....sure enough, the share price is down 50% at the time of writing (and 25% since he started writing this post, when the chart below was posted.)
The rapture from last night's eurphoric US action was dispelled pretty quickly in early European trading, with something of a "witch's hat" formation at the open.
Not that action in other markets has been particularly pleasurable; price action in December eurodollars has been, and there's really no other word for it, ugly.
Macro Man is naturally busy managing his book. In normal circumstances, running a book is like playing quarterback- you take the ball and scan the field for opportunities to strike. This month, he's been playing left tackle on the offensive line: his job is to provide a pocket of protection so that his quarterback doesn't get killed.

It's not a glamorous job, but as any NFL aficionado will tell you, it's among the most important (and best-paid on the team.) It's just a coincidence that most of the guys who fill the role are u-g-l-y.