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They also can't borrow at negative real interest rates. Only some governments can. And you can't blame the governments for low interest rates. At least in th
by greeneggs 10y ago
They also can't borrow at negative real interest rates. Only some governments can. And you can't blame the governments for low interest rates. At least in the medium term, interest rates are mostly set by the market, supply and demand for loans. There's not a lot of demand.
- GenWintergreen 10y agoSure they can. AAPL issued bonds in 2015.
- guelo 10y agoThat's just part of their tax avoidance schemes. And they did not get negative rates on them.
- greeneggs 10y agoI didn't say they can't issue bonds. I said they can't borrow at negative interest rates, or even negative real interest rates. Here's what they sold in February 2016, for example (annual inflation was 1.0%): - $500 million in 1.3% two-year notes issued at a spread of 60 basis points over similar-maturity Treasuries - $500 million in three-year FRNs (floating rate notes) issued at three-month LIBOR + 82 basis points - $1.0 billion in 1.3% three-year notes issued at a spread of 60 basis points over similar-maturity Treasuries - $500 million in five-year FRNs issued at three-month LIBOR + 113 basis points - $2.25 billion in 1.7% five-year notes issued at a spread of 80 basis points over similar-maturity Treasuries - $1.5 billion in 2.25% seven-year green notes issued at a spread of 105 basis points over similar-maturity Treasuries - $2.0 billion in 2.85% ten-year notes issued at a spread of 135 basis points over similar-maturity Treasuries - $1.25 billion in 3.25% 20-year bonds issued at a spread of 150 basis points over similar-maturity Treasuries - $2.5 billion in 4.5% 30-year bonds issued at a spread of 190 basis points over similar-maturity Treasuries http://marketrealist.com/2016/02/investment-grade-corporate-bond-issuance-gained-traction/ http://marketrealist.com/2016/02/investment-grade-corporate-...