Investment Grade
Nomi Prins' Financial Road Map For 2016: "The Potential For Chaotic Fluctuations Is Greater Than Ever"
Submitted by Tyler Durden on 01/05/2016 18:15 -0500- Bernie Sanders
- Bond
- Brazil
- Capital Markets
- Central Banks
- China
- Circuit Breakers
- Corruption
- default
- European Central Bank
- Excess Reserves
- Federal Reserve
- Fitch
- Greece
- Investment Grade
- Iran
- Italy
- Janet Yellen
- Japan
- Mexico
- Monetary Policy
- None
- OPEC
- Portugal
- Recession
- recovery
- Saudi Arabia
- Unemployment
- US Dollar Index
- Volatility
- Yuan
We are currently in a transitional phase of geo-political-monetary power struggles, capital flow decisions, and fundamental economic choices. This remains a period of artisanal (central bank fabricated) money, high volatility, low growth, excessive wealth inequality, extreme speculation, and policies that preserve the appearance of big bank liquidity and concentration at the expense of long-term stability. The potential for chaotic fluctuations in any element of the capital markets is greater than ever. The butterfly effect - the flutter of a wing in one part of the planet altering the course of seemingly unrelated events in another part - is on center stage.
The Battle Between Manufacturing And Services
Submitted by Tyler Durden on 01/03/2016 14:00 -0500As we start the new year, there is a debate raging within the market. No the debate isn’t whether there is weakness in the manufacturing economy, that is taken as a given, especially after Friday’s awful Chicago Purchasing Manager number of 42.9. Instead, the debate boils down to this: 'bears' believe the manufacturing economy and the service economy act in conjunction with each other – that one cannot turn, without the other; 'bulls' view each segment of the economy as relatively independent and they highlight the size of the service economy relative to the manufacturing. The answer lies in the missing cog - the 'wealth' economy.
Junk Isn't Very Noble: Asia's Largest Commodity Trader Responds To Moody's Downgrade
Submitted by Tyler Durden on 12/30/2015 09:48 -0500For now Noble refuses to throw in the towel, and overnight released the following statement on the Singapore Exchange where its massively beaten down stock trades.
Asia's Largest Commodity Trader Was Just Downgraded To Junk: Collateral Calls Next?
Submitted by Tyler Durden on 12/29/2015 17:52 -0500"Moody's downgrades Noble Group to Ba1; outlook negative.... "The downgrade of Noble's ratings reflects Moody's concerns over the company's liquidity," says Joe Morrison, a Moody's Vice President and Senior Credit Officer. The Ba1 ratings also reflect low levels of profitability and consistent negative free cash flow from core operating activities, which exclude proceeds from asset sales."
The Dark Side Of A Record $5 Trillion In Mergers: Hundreds Of Thousands Of Imminent Layoffs
Submitted by Tyler Durden on 12/29/2015 12:57 -0500The winners from a $5 trillion M&A bubble: Wall Street bankers will make hundreds of millions in M&A fees. The losers: hundreds of thousands of workers who are about to be laid off, pardon, "synergized."
Safe On The Sidelines - 405 Days And Counting
Submitted by Tyler Durden on 12/29/2015 08:46 -0500The S&P 500 closed at 2052 on November 18,2014. That was 405 days ago, and despite the rips and dips in the interim the broad market average has gone nowhere.
Stock Buybacks In Jeopardy: Investment Grade Bond Funds See Biggest Outflow In 17 Weeks
Submitted by Tyler Durden on 12/24/2015 09:13 -0500There has been a "continued shunning of fixed income" with over $25 Bn of outflows from bond funds in three weeks, of which $6.4 Bn took place in the past week, resulting in outflows in 6 of past 7 weeks.However, the biggest outflow risk is not to Junk but to investment grade, that main funding source for trillions in corporate stock buybacks: it was the IG space that took another beating with largest outflows ($3.5bn) in 17 weeks!
As Wall Street Vultures Circle The Next Junk Bond Fund Casualty, A Familiar Name Emerges
Submitted by Tyler Durden on 12/20/2015 22:38 -0500And so Wall Street has set its sights on the next junk bond fund casualty, a name which is well-known to most equity market participants: none other than Waddell and Reed (WDR), the fund which rose to infamy in the aftermath of the May 2010 Flash Crash, after it was initially blamed by the SEC as the culprit behind the Dow's 1000 point crash...
Market Figures Out Fed No Longer Has Its Back
Submitted by Tyler Durden on 12/20/2015 15:45 -0500The Fed is now - for the first time in adult memory for half the world’s traders and money managers - tightening rather than loosening monetary conditions. A quick look at financial history is all it takes to lead anyone with leveraged money at risk to lighten up. Equally important - and vastly more strange when you think about it - this tightening comes at a time when major parts of the global economy are either grinding to a halt or imploding.
Despite Lifting Of Export Ban, Moody's "Bombshell" Sparks Panic In Energy Credit Markets
Submitted by Tyler Durden on 12/19/2015 18:50 -0500The Senate and House passed the spending bill this week, which the President signed into law on the same day. Embedded in the law is a provision to lift the 40-year old crude export ban. The lifting of the crude export ban is a historic milestone, but seemingly less relevant for US E&Ps, Midstream and Oilfield Services as compared to a year and a half ago when WTI-Brent spreads were close to $9.00/bbl vs. the current spread of $0.80/bbl. Nevertheless, there is still a negative long-term impact on refiners should spreads re-widen.
Moody's Downgrades Glencore To Lowest Investment Grade Rating As CDS Trade A Multi-Year Highs
Submitted by Tyler Durden on 12/18/2015 09:15 -0500Weak earnings performance in marketing operations below the current EBIT guidance of $2.4-$2.7 billion could place negative pressure on the Baa3 ratings in the absence of any mitigating measures. A weakening of the company's liquidity position, delays with the planned divestments in 2016 or a material reduction in its working capital funding capacities by the banks, as well as sustained high leverage with adjusted debt/EBITDA exceeding 4x, will also put negative pressure on the Baa3 ratings."
Markets Brace For More Fund Liquidations As Record Outflows Slam Debt Funds
Submitted by Tyler Durden on 12/17/2015 21:33 -0500As new investor liquidity evaporates and as billions are redeemed first from the junk bond universe, then investment grade and then loans, the debt crisis which was unleashed in anticipation of the Fed's rate hike, is about to get much worse, and lead to even more prominent hedge fund "gates" and liquidations.
Presenting Saxo Bank's 10 "Outrageous Predictions" For 2016
Submitted by Tyler Durden on 12/16/2015 17:40 -0500- Australia
- B+
- Black Swan
- Bond
- Brazil
- Bridgewater
- Capital Markets
- China
- Consumer Confidence
- Copper
- Corporate Leverage
- Crude
- Crude Oil
- Donald Trump
- European Central Bank
- Federal Reserve
- Futures market
- Glencore
- High Yield
- India
- Investment Grade
- Iran
- Janet Yellen
- Lehman
- Meltdown
- Monetary Policy
- Nomination
- OPEC
- Ray Dalio
- Reality
- Recession
- recovery
- Risk Premium
- Saxo Bank
- Ukraine
- Unemployment
- Volatility
"The irony in this year’s batch of outrageous predictions is that some of them are “outrageous” merely because they run counter to overwhelming market consensus. In fact, many would not look particularly outrageous at all in more “normal” times – if there even is such a thing!"
A Pessimists' Guide To 2016: When Everything That Can Go Wrong, Does Go Wrong
Submitted by Tyler Durden on 12/15/2015 18:30 -0500
Goldman Warns IG Credit Collapse Signals S&P 500 Notably Overvalued
Submitted by Tyler Durden on 12/15/2015 14:40 -0500The sell-off in credit over the past week has led many investors to ask what it means for equities. Credit spread widening usually has negative implications for equity but as Goldman notes, it is critical to estimate the degree to which the equity market has already priced the weakness to determine the potential risks to equity going forward. Interestingly, Goldman finds the weakness in high yield credit was foreshadowed by weakness in the equities of high yield companies (like for like), but the weakness in Investment Grade credit spreads relative to their corresponding equities represents a new divergence suggesting meaningful downside for S&P 500 investors.


