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corporate bonds

A Year In Junk

By |2015-12-31T17:36:29-05:00December 31st, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

The most important outbreak or story of 2015 had to have been the junk bond reversal. It combined all the major elements of what investors and economic agents are both fearing and, at one point in the past anyway, hoping. It is the confluence of finance, “dollars”, liquidity and economics with or without recovery and the best scenario. The FOMC [...]

Risk Reset

By |2015-12-10T12:11:42-05:00December 10th, 2015|Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

If there is a shift in the credit scheme of the junk bond bubble of late, the reduced volume in issuance would suggest why. While issuance, including high yield and leveraged loans, has been volatile the past few years it had never been so persistently beaten down as it is now. In other words, there had been “slow” periods in [...]

Math Is Money: Tracking Through Swap Spread Possibilities

By |2015-11-11T18:27:39-05:00November 11th, 2015|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

As banks have trickled out their third quarter balance sheet filings, we gain more insight into the events of that quarter as well as some additional color as to the ongoing drama of the current one. Perhaps the most startling shift in an otherwise quite busy and at times despondent period was the universal compression of swap spreads into negative [...]

Not A Done Deal

By |2015-11-08T18:29:21-05:00November 8th, 2015|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

Last week's employment report raised the odds of a December rate hike considerably and the consensus at this point seems to be that it is a done deal. The employment report was pretty good with the unemployment rate down to 5%, 271,000 jobs added and a pay hike to boot. Year over year average hourly earnings are now up 2.4%, [...]

More Order On This Side, To This Point

By |2015-08-12T16:04:55-04:00August 12th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

On this side of “dollar” funding, risk continues to drain, steadily, but rather methodical about it. While China is taking most of the attention, deservedly, credit markets are not enthused about any of what has taken place. Again, I think that is more the yuan’s relation to the “dollar” than of anything else interpreted for or about the PBOC. It [...]

The ‘Dollar’ Does Disturb Junk

By |2015-06-23T17:30:56-04:00June 23rd, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

Stocks may be ignoring the “dollar” and liquidity more broadly (at least as far as repurchases are concerned) but the continued stress in the eurodollar world has had an accumulating effect in some places. Primarily that has been shown in the once-thriving junk space, including more illiquid “products” like leveraged loans, which has continued in disfavor more recently. The shift [...]

The Lesson In China: Don’t Go Bubble In the First Place

By |2015-06-17T12:28:12-04:00June 17th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

There can be no mistaking that Chinese stocks are in a bubble. Since November 21, the Shanghai SSE Composite index has risen more than 100%. Going back to July 22, the gain is nearly 145%. Those dates are not random coincidence, as they mark specific points of PBOC activity. The stock bubble in China is certainly a monetary affair, but [...]

It Is Inflation

By |2015-06-08T16:13:49-04:00June 8th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

There was a reason FDR’s administration in its first 100 days took the order it did. Contrary to some assertions, Executive Order 6102 was not a lawless expansion of executive privilege and prerogative. It had a very lawful basis, underwritten by the Emergency Banking Act of 1933 which itself was based on (and no part of this fact should be [...]

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