Remember a week ago when every TV anchor, pundit, asset-gatherer, and commission-taker stormed onto mainstream media and proclaimed the credit market collapse "fixed" because prices had 'stabilized' over the holiday period "proving that 3rd Avenue was a one off" and this dip was a buying opportunity? Yeah, well that was all complete crap... as Investment-Grade cost of funding hits a 3-year high, HY bond spreads blew out to cycle wides, 'triple-hooks' soared to their worst levels in almost 7 years, and credit protection costs rose by the most in years.
"Stabilized" (during the Christmas break) was the new "everything is awesome"... but now...
High Yield Bond ETFs are dumping...
[7]
The cost of high-yield credit protection is soaring...
[8]
Equity prices are starting to catch down to that reality...
[9]
As is the cost of equity risk protection (VIX following August's "wait what" reality-wake-up call path)...
[10]
And that means trouble for the only pillar of non-economic stock buying left... Investment-Grade credit risk just hit 3-year highs crushing the economics of any debt-funded shareholder-friendly activities...
[11]
And finally, where it all started - CCC 'triple-hooks' credit spreads have re-spiked to cycle wides...
[12]
But apart from that - yeah, credit is "fixed."
