by Calculated Risk on 9/17/2008 09:50:00 AM

Here is the TED Spread from Bloomberg. The TED spread has increased to 2.76% (from just over 2% yesterday). This is far above the highs reached in August 2007, late 2007 and in the spring of 2008.

Note: the TED spread is the difference between the three month T-bill and the LIBOR interest rate. Usually the TED spread is less than 0.5%. The higher the spread, the greater the perceived credit risks (compared to "risk free" treasuries).

Much of the increase in the TED spread is because of the flight to safety. From Bloomberg: Treasury 3-Month Bill Rates Drop to Lowest Since at Least 1954

U.S. Treasury three-month bill rates dropped to the lowest since at least 1954 ... Investors pushed the rate as low as 0.233 percent as the loss of confidence in credit markets deepened.

The article points to concerns about the Reserve Primary Fund money market freezing redemptions (and "breaking the buck").