COTD: Corporate Debt

No lack of supply/issuance in the corporate debt market.   No shortage of demand either.

Lots of nuances in interpreting data, however.  First, much of debt going to financial engineering, i.e., stock buybacks.  Some of the supply is borrowing against capital stuffed overseas driven by tax incentives, such as Apple.

Last, but not least,  NIRP and ZIRP – record low real interest rates.

One big concern is, given the increase in financial regulation,  who is going to make the markets and liquidity for this stuff when investors start coughing it up?

 

Corporate Debt_Oct3

(COTD = Chart of the Day)                                                          Hat Tip:  Jesse Felder

This entry was posted in Bonds, Credit, Uncategorized and tagged . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s