Be Warned: Record Everything Ain’t Real!

We’re witness to historic developments across global financial markets extending far beyond an equities melt-up. U.S. corporate Credit this week traded near the narrowest spreads (to Treasuries) since 2007. Popular Credit default swap (CDS) indices priced this week at pre-crisis lows – investment-grade and high yield. At 46 bps, Goldman Sachs (5-yr) CDS closed the week at the low since 2007. JPMorgan CDS fell five bps this week to 30.6 bps, the low going back to October 2007. A Leveraged Loans index closed Friday at a record high price. European fixed-income CDS ended the week at or near multi-year lows – investment-grade, high-yield and financial. And this week from Bloomberg: “U.S. High-Grade Market Devours Nearly $100 Billion in New Debt.”

 

 

 

 

http://creditbubblebulletin.blogspot.com/2020/01/weekly-commentary-this-is-insane.html