Posted on 02/14/2016 8:13:53 AM PST by Lorianne
It’s not contained.
There are over $1.8 trillion of US junk bonds outstanding. It’s the lifeblood of over-indebted corporate America. When yields began to soar over a year ago, and liquidity began to dry up at the bottom of the scale, it was “contained.â€
Yet contagion has spread from energy, metals, and mining to other industries and up the scale. According to UBS, about $1 trillion of these junk bonds are now “stressed†or “distressed.†And the entire corporate bond market, which is far larger than the stock market, is getting antsy.
The average yield of CCC or lower-rated junk bonds hit the 20% mark a week ago. The last time yields had jumped to that level was on September 20, 2008, in the panic after the Lehman bankruptcy, as we pointed out. Today, that average yield is nearly 22%!
Today even the average yield spread between those bonds and US Treasuries has breached the 20% mark. Last time this happened was on October 6, 2008, during the post-Lehman panic
(Excerpt) Read more at wolfstreet.com ...
Not to worry.
Obama is on top of this.
“Fore!”
But unemployment is less than 5%!!!!
Or maybe, if we calculated unemployment the same way they did in the 1930’s; it’s actually 25%.
Or, as Donald Trump has pointed out; it’s actually around 40%; if you subtract the Participation Rate from the potential workforce.
A friend of mine in Orange County, CA just told me about the large retail stores that have permanently closed their doors in her area; Home Depot, Vons, Smart & Final, etc. And Macy’s is getting ready to close their doors soon.
The Obama Economy - worse than the Franklin Frickin Roosevelt Economy!!! LOL.
i am cautiously trading the foreign currencies EUR and AUD against the USD.
major moves the past few weeks.
could just be another fake out, or this time the real deal.
the problem is all the other currencies suck too, so that has kept a lid on the upside.
if the day comes when the majority see the EUR as more risk free, the EUR/USD will go to 1.40 or more
Soon all the petty, silly insults and posturing that have characterized this Presidential campaign will be dwarfed by the coming economic reality. The political dynamic will change dramatically as the American people will become frightened and anxious about their economic status. Trump will benefit immensely.
What could go wrong? LOL
As long as Janet can talk the DOW back up, everything will stay rosy.
How bad can it be with 5% unemployment?....comrades.
You are correct. I have thought the same thing for some time. Real panic is coming.
Tsunami warnings, but few believe because it is not yet seen. Once seen, it is way to late to save much of anything.
I’m just grateful that the chocolate ration has been increased again.
Isn’t that pretty much a low wage/no jobs/section 8 area?
Just curious.
Isn’t that pretty much a low wage/no jobs/section 8 area?
Just curious.
Orange County? You’re kidding.
When did yields soar?
Another chunk of the debt regime is about to break off. The desperation from central banks and governments is naked and exposed to all.
The cheap oil move, built on propaganda:
Strike!
The negative interest scare, also built on propaganda:
Ste-e-erike!
My guess: one more.
Orange County, CA is actually doing pretty well economically, but it's become a very expensive place. Retail is having a tough time for several reasons, not the least of which is competition from internet sales, primarily Amazon. I'm not so sure that store closures there indicate economic weakness, but it could be that residents are strapped due to the cost of living.
Which Soaring yields are we talking about?
I thought the 10yr Bond yields were falling precipitously low
??
I dunno. It was a claim made in the first sentence.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.