High Yield

• Yields 4.009% vs. Exp. 3.994%
• Bid To Cover 2.37 vs. Avg. 2.59 (Prev. 2.92)
• Indirects 34.5% vs. Avg. 48.03% (Prev. 46.7%)
• Indirect Bid To Cover: 1.51
• Allotted at high 27.53%
• 8.5% of accepted to directs

• Yields 1.445% vs. Exp. 1.441%
• Bid-To-Cover 2.76 vs. Avg. 2.80 (Prev. 3.02)
• Indirect Bid-To-Cover 1.34
• Indirects 49.1% vs. Avg. 50.45% (Prev. 54.23%)
• Allotted at high 61.96%
• Direct bidders at a sturdy 11%: money market guarantee expiration? Do directs prefer Treasuries over equities?

There is no better representation of the ongoing irrational exuberance in capital markets than what has been happening with HY bond issuance. And the number indicates that many fixed income fund managers are staring at a lot of pain in the future: YTD there has been $100 billion issued in HY bonds, more than double the $49 billion issued in all of 2008. The biggest losers in all of this: restructuring shops who have been hiring senior bankers left and right to prepare for an onslaught of bankruptcies. Alas, with the majority of 5x+ leveraged dinosaurs extending maturities yet again compliments of "money that just has to be put to work" expect bankruptcies to be indefinitely delayed once more, never mind that the deteriorating underlying businesses generate less cashflow than ever and actual bond recoveries, when the inevitable bankruptcies finally do come, will be worse than single digits.

• Yields 3.005% vs. Exp. 3.047%
• Bid-To-Cover 2.79 vs. Avg. 2.55 (Prev. 2.74)
• Indirects 61.7% vs. Avg. 51.44% (Prev. 61.3%)
• Indirect Bid-To-Cover: 1.29x
• Direct accepted: 6.3% of Total accepted
• Allotted at high 30.22%

• Yields 2.470% vs. Exp. 2.4625
• Bid-To-Cover 2.40 vs. Avg. 2.31 (Prev. 2.51)
• Indirect 44.8% vs. Avg. 46.20% (Prev. 56.3%)
• Indirect Bid-To-Cover: 1.26
• Allotted at high 39.82%, compared to 16.55% a month ago.
• Direct bidders increased to 11% compared to ~4% pre money market guarantee expiration (per Santelli): new capital flow?

• Yields 1.034% vs. Exp. 1.0296%
• Bid-to-cover 3.23 vs. Avg. 2.85 (Prev. 2.68)
• Indireect 45.2% vs. Avg. 46.9% (Prev. 49.5%) 
• Allotted at high 27.16%

A surprisingly robust auction, indicating that demand for US Treasuries despite a continuing supply onslaught, will not taper off. Is this merely more rotation out of agencies and MBS? Whether this demand is coming from foreign purchasers or has domestic sources is, at this point, unclear.

• Yields 4.238% vs. Exp. 4.289%
• Bid-To-Cover 2.92 vs. Avg. 2.48 (Prev. 2.36)
• Indirect 46.5% vs. Avg. 48.46% (Prev. 50%)
• Allotted at high 85.35% (BBG)

• Yield 2.494% vs. Exp. 2.509%
  
• Bid-to-cover 2.51 vs. Avg. 2.21 (Prev. 1.92)
• Indirects 56.4% vs. Avg 34.6% (Prev 37%)
• Indirect bid-to-cover 1.31x
• Allotted at high 16.55% (BBG)

• Yields 1.119% vs. Exp. 1.115%
• Bid-to-cover 2.68 vs. Avg. 2.86 (Prev. 2.75)
• Direct bids 49.4% vs. Avg. 47.66% (Prev. 33.01%)
• Allotted at high 92.32% (BBG)

HY 12 doesn't believe in this rangebound mumbojumbo - credit traders have to really earn their living. Speaking of, when will "liquidity providers" also get involved in this product and start trading amongst themselves.

Bloomberg reports that the largest publicly traded asset manager has lost its two key debt-focused executives.

Every now and then the general public gets a chance to see just how valid the green shoots theory really is. Next Friday may prove to be just such a case. On this date, 20 of some of the gnarliest and most troubled stressed and distressed high yield credits have a simultaneous IOU due to their respective lenders, either in the form of an interest payment or outright maturity. Zero Hedge has compiled the list of the 20 most interesting suspects to watch carefully.

At the end of the day fund flows talk and TV propaganda walks (and both have a 30 day grace period).

Every now and then the general public gets a chance to see just how valid the green shoots theory really is. Next Friday may prove to be just such a case. On this date, 20 of some of the gnarliest and most troubled stressed and distressed high yield credits have a simultaneous IOU due to their respective lenders, either in the form of an interest payment or outright maturity. Zero Hedge has compiled the list of the 20 most interesting suspects to watch carefully.

At the end of the day fund flows talk and TV propaganda walks (and both have a 30 day grace period).

Every now and then the general public gets a chance to see just how valid the green shoots theory really is. Next Friday may prove to be just such a case. On this date, 20 of some of the gnarliest and most troubled stressed and distressed high yield credits have a simultaneous IOU due to their respective lenders, either in the form of an interest payment or outright maturity. Zero Hedge has compiled the list of the 20 most interesting suspects to watch carefully.

At the end of the day fund flows talk and TV propaganda walks (and both have a 30 day grace period).

While the vicious love quadrangle (no pun intended Mr. Rattner) of Bernanke, Geithner, Lewis and Vikram pound the table on just how well lubricated the credit markets have become, the truth is that aside from ultra high quality Investment Grade names and TLPG-backed financial issuance, the credit market is for all practical purposes still in critical condition and about to be carted off to the morgue. The fact is that YTD issuance in the riskier HY and loan markets (see chart below) stands at a meager $22 billion - the lowest level in recent history.