Category Archives: High Yield
SocGen: “Low Vol Can Misprice High Yield By Up To 30%”
Yesterday it was Bank of America, today’s it’s SocGen’s turn. As we’ve repeatedly stated in the past, not a day seems to pass without some broker, investor, sellside analyst or pundit (this website certainly included) opining on i) how low the Vix has fallen, ii) how much lower it will fall, and iii) how the […]
Bank of America: “Tick Tock”
The drums of doom from BofA’s Michael Hartnett (most notorious for his recent prediction of when “the Fed will crash the market“, and warning that “The Most Dangerous Moment For Markets Will Come In 3 Or 4 Months“) are beating louder, and in his latest Flow Show report titled “Tick Tock”, he doubles down on […]
3-Month Treasury-Bill Auction Prices At Highest Yield Since Lehman On Debt-Ceiling Concerns
It seems Morgan Stanely was right when they said "the debt ceiling worries us most," as today's 3-month T-Bill auction surprised the market with its highest yield since the fall of 2008, as investors continue to price concerns that the U.S. government will exhaust its borrowing authority around mid-October. As SMRA details: The 3-month bill […]
Russell Clark Speaks In RealVision’s “Most Requested Interview Ever”
According to RealVision, he’s one of the greatest investors you’ve never heard of. According to us, he ran what was (formerly) the world’s most bearish hedge fund, although at the end of 2016, after suffering substantial losses, he capitulated and went flat, after closing much of his short book. To be sure, Russell Clark, and […]
Junk Bonds Are Finally Starting To Care About Oil
Back in May, we pointed out an interesting observation made by Goldman: unlike late 2015 and most of 2016, when equities demonstrated surprising resilience to the swoon in oil prices, in 2017 OPEC’s failure to stabilize oil prices finally hit energy equities disproportionately. As Goldman said in mid-May, discussing the latest crude oil selloff, which […]
What Bond Traders Are Most Worried About Right Now
The latest monthly survey of credit investors from Bank of America, released overnight, shows the same familiar paradox we have seen ever since the start of the year: most survey respondents are allegedly scared worried about geopolitics and a concerned that the market is a bubble, and yet at the same time, most are allocating […]
Mediocre, Tailing 7Y Auction Prices At Lowest Yield Since October
After a strong 2Y auction on Monday, a poor 5Y issuance on Tuesday, today the Treasury concluded this week’s bond issuance with the sale of $28 billion in 7Y paper in a mediocre auction, which probably could have been even worse had it not been for Draghi’s “clarification”. The high yield of 2.056% tailed the […]
Warning: the Oil Crash Is Just Days Away From Triggering a Debt Crisis
The Oil collapse is about to trigger a crisis in junk bonds. Oil has been going straight down for weeks now. As we write this, black gold is below $43 a barrel, down 16% from its levels a month ago. “So what?” you might ask, “Oil experiences similar drops all the time. Why is this […]
WTI Tumbles To $42, Brent Below $45 As Credit Crashes
High yield energy credit markets are in trouble again, with risk now at its highest level in 7 months. Despite this morning’s Iran-hyped OPEC bullshit and a small draw in Gasoline, it appears the reality of surging US shale production and lagging demand is weighing down oil (and gasoline) markets… Since OPEC announced its production […]