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In adhering to its strict philosophy of throwing out all babies with the bathwater and never believing in fundamental analysis, and also continuing with its recent mass downgrades of all the assets it had been pumping for ages, Moody's earlier came out with a bomb on an announcement saying it has put essentially all CLO tranches on downgrade review.

Surprising miss Kary did not break this one (maybe former Goldman restructuring honcho now K&E restructuring honcho Jaime Sprayregen finally "plugged" his leak), instead this piece of news comes compliments of Debtwire. According to "two sources familiar with the situation" Chemtura has hired Kirkland & Ellis as legal counsel and Lazard as financial advisor.

As the market is running on fumes based on some doctored Chinese data, GE keeps probing new depths, hitting another record low of $6.36 at last check. The major concern plaguing the AAA-rated conglomerate today (whose CDS trades at distressed debt levels of about 20 points upfront) has to do exactly with its credit rating. According to a Fortune report, there is a sword of Damocles hanging over GE's head, in the form of a rating agency downgrade.

The search for safe spots in the market rout so far this year has resulted in some curious hiding places. The big rotation out of equities in the end of 2009 and into credit has accelerated, and while IG initially was considered the frontrunner for the safe credit category, it is surprisingly junk debt that has emerged as the best performing sector of 2009.

• GE CDS trades at 19 points
• ADP unemployment increases by 697k, 70k more than expected "priced in" (Bloomberg)
• MGM says it may breach covenants soon (Bloomberg)
  

• New $60 billion treasury sale on deck (Bloomberg)
• The unemployment breadth of the recession (NYT)
• Junk bond borrowers line up (WSJ)
• China announcing new stimlus plan, 3 months after last (Blo
  

From the every vigilant and never counterpartied Goldman Sachs

LPX may have averted bankruptcy in the last moment at the expense of a few gullible investors, who ended up purchasing the bond issue LPX had been marketing for over 5 months. Bank of Countrywide Lynch and Goldman have to be given props for this one as the Stardust odds for a successful LPX bond placement were roughly 10 to 1 against.

The same author who earlier scared the bejeezus out of Blockbuster shareholders, and who likely used the same mole she has within Kirkland & Ellis (note to Jamie Sprayregen: you have one angry leak in your midst, may want to consider tapping those phone lines), announced that Reader's Digest was the second company today to hire th

Hartford Financial was downgraded by S&P for the third time in a month, this time from BBB+ to BBB, a mere two notches above being considered full blown junk. In its statement, S&P said:

In the latest example of just how half-baked the administration's "economic recovery" ideas are, the Fed and U.S. Treasury just announced that TALF sponsors will not be subject to the same executive compensation limits that all other TARP recipients have to adhere to.

Blockbuster denies hiring Kirkland & Ellis to explore bankruptcy, and instead K&E's role will be to assist with refinancing. We do have our doubts as usually every K&E involvement ends up in a monthly retainer filed on Whitehall street, but we'll go with the company on this one.

Bloomberg amends it prior release:

“We’ve hired them for refinancing and capital raising initiatives,” said Karen Raskopf, a Blockbuster spokeswoman..“We do not intend to file for bankruptcy.”

From S&P downgrade just issued:

Update: No Bankruptcy to be filed apparently. Bloomberg is headline hungry pessimism monger (unlike Zero hedge)

Total car sales down to 58,813 from 107,592. Hilariously the company is banging the table and claims its sales forecast will be met... GM sees its Q2 2009 production at 550,000 vehicles, a 34% cut. It is odd that the company will be making any cars at all when it still has 781,000 vehicles in inventory at the end of February.