With historically low interest rates before the recent market crash, corporate debt has skyrocketed. According to the Federal Reserve Bank of St. Louis, Nonfinancial Corporate Business Debt has eclipsed $6.5 Trillion. Low interest rates have given rise to “zombie corporations.” A “zombie corporation” only generates enough revenue to service its own debt, and as a result, […]
As reported by Bloomberg on December 13, 2015 (“Investors See Third Avenue Fueling More Bond Market Carnage”), “top bond managers are predicting more carnage for high-yield investors amid a market rout that forced at least three credit funds in the past week to wind down.” The three bond funds that suffered losses within the past week […]
The U.S. High-Yield bond rout deepened Monday, with the bonds of dozens of low-rated companies falling anew and the shares of some large fund-management firms tumbling as well. Investors are rushing out of junk bonds, spooked by last week’s closure of a mutual fund focused on some of the lowest-quality, highest-yielding bonds. The shutdown comes […]