Twas the Night Before Inauguration!
1 hour ago
Not since the Hungarian Countess Elizabeth Bathory has there been a bloodbath like the one taking place in "Junk Bonds" right now.- The attached "heat map" shows the YTD status of junk bonds since 01 Jan '15.There are a few still in the green for the year, but not many.- For the FED and FTV: red is bad, and the redder the badder.Several funds (Stone Lion and Third Ave) have already 'gated' their investors [read: you cannot get your money out]. - I'd bet there will be more to follow.NOT SHOWN are the massive pile of derivatives that are connected to, and depend upon, this 'debt without collateral.' Junk bonds are only a couple trillion dollar market - the proverbial tip of the iceberg showing above the water, but it's the derivatives [read: bets] that are truly huge and unseen under the water....forgive the pun.- When that house of cards collapses, 'depends' won't be enough to contain the damage.
From Theo Spark at 11:50