The TED spread is widening, credit risk is trading higher. On the margin this is a bearish sign.
Keith is bearish on France, the S&P 500, and Japan for a variety of reasons. One of those reasons is that the TED spread has been expanding steadily, indicating an increase in perceived risk in the general economy. Sovereign debt concerns in Europe are garnering a lot of attention from the investment community over recent weeks. It is interesting to note that the correlation between the TED Spread and the EURUSD is -0.93.