The TED spread is the difference entre les interest rates are interbank loans and one short-term US government debt ( “T-bills”). TED is an acronym formed from T-Bill and ED , the ticker symbol for the Eurodollar futures contract.
INITIALLY, the TED spread Was the différence entre the interest rates for three-month US Treasuries contracts and the three-month Eurodollar contract représentée by the London Interbank Offered Rate (LIBOR). However, since the Chicago Mercantile Exchange dropped T-bill futures after the 1987 crash,  the TED spread is now calculated as the difference between the three-month LIBOR and the three-month T-bill interest rate.
Formula and reading
The size of the spread is usually denominated in basis points (bps). For example, if the T-bill rate is 5.10%, and the TED spread is 5.50%, the TED spread is 40 bps. The TED spreads fluctuates over a period of 10 to 50 bps (0.1% and 0.5%). A rising TED spread is a downturn in the US stock market, as it appears that liquidity is being withdrawn.
The TED spread is an indicator of perceived credit risk in the general economy,  since T-bills are considered risk-free while LIBOR reflects the credit risk of lending to commercial banks. An Increase in the TED spread is a sign That Lenders believe the risk of default is interbank loans (Also Known As counterparty risk ) is Increasing. Interbank lenders, therefore, demand a higher rate of interest, or accept lower returns on safe investments such as T-bills. When the risk of bank defaults is considered to be decreasing, the TED spread decreases.  Boudt, Paulus, and Rosenthal show that a TED spread above 48 basis points is indicative of economic crisis. 
The long-term average of the TED spread has been 30 basis points with a maximum of 50 bps. During 2007, the subprime mortgage crisis ballooned the TED spread to a region of 150-200 bps. On September 17, 2008, the TED spread exceeded 300 bps, breaking the previous record set after the Black Monday crash of 1987.  Some higher readings for the spread were due to inability to obtain accurate LIBOR Unsecured lending market.  On October 10, 2008, the TED spread reached another high of 457 basis points.
In October 2013, due to worries regarding a potential default on US debt, the 1-month TED went negative for the first time since it was being tracked.  
- LIBOR-OIS spread
- Overnight indexed swap
- Treasury Bill
- Treasury security
- Jump up^ http://www.atimes.com/atimes/Global_Economy/LK25Dj01.html
- Jump up^ Bloomberg.com Financial Glossary
- Jump up^ Paul Krugman – Op-Ed Columnist – New York Times
- Jump up^ Boudt, K .; Paulus, E .; Rosenthal, DWR (2017). “Funding liquidity, market liquidity and TED spread: A two-regime model”. Journal of Empirical Finance . 43 : 143-158. Doi : 10.1016 / j.jempfin.2017.06.002 .
- Jump up^ Financial Times. (2008). Panic grips credit markets
- Jump up^ Bloomberg – Libor Jumps as Banks Seek Cash to Shore Up Finance
- Jump up^ Obama Says Real Boss in Default Showdown Means Bonds Call Shots, Bloomberg.com, 11 October 2013
- Jump up^ UBS Asset Management Taps Derivatives to Hedge US Debt Risk, Bloomberg.com, 10 October 2013