4 ms·

Asof EOD friday from about 1145 trackable CUSIPs in firna trace underlying HYG, there's 20 of them either in default or companies that have applied for bankrupt

Asof EOD friday from about 1145 trackable CUSIPs in firna trace underlying HYG, there's 20 of them either in default or companies that have applied for bankruptcy protection. A lot more have be rolled out from HYG though.

vmception 6y ago
nice, yeah thats something I find interesting too but the Fed's junk bond ETF purchasing has already been active. this article is about its investment grade primary and secondary market corporate credit facility, which was authorized with the CARES Act but took till June to get started.
- cinquemb 6y ago
  Yeah, nothing in default yet from EOD friday in LQD. Of about 2272 CUSIPS in LQD then, 58 are rated BB, Baa1 392, Baa2 406, Baa3 251. I expect that it will happen soon that at least a few of these go into default.
  - vmception 6y ago
    Unless they directly issue to the fed and use the proceeds to pay off prior debt This is very commonplace in corporate credit, aside from issuing directly to the federal reserve, which has offered verbatim to be the sole investor! Free money! I read the whole CARES Act and found this extra large bailout to be the biggest market distortion and thought it should have more air time than PPP or unemployment insurance boosts
    - cinquemb 6y ago
      > Unless they directly issue to the fed and use the proceeds to pay off prior debt True, it could happen, but it would take away from the profits banks and secondary market participants get from issuing it directly them selling the debt to treasury dept leveraging fed bucks :P
      - vmception 6y ago
        haha thats also happening, the fed is operating two new programs Check it out Primary Market Corporate Credit Facility Secondary Market Corporate Credit Facility https://www.federalreserve.gov/monetarypolicy/pmccf.htm https://www.federalreserve.gov/monetarypolicy/pmccf.htm https://www.federalreserve.gov/monetarypolicy/smccf.htm https://www.federalreserve.gov/monetarypolicy/smccf.htm
        cinquemb 6y ago
        Yup, i've been following the alphabet soup of insolvency for a while[0] [0] https://wolfstreet.com/wp-content/uploads/2020/07/US-Fed-Balance-sheet-2020-07-02-SPV-.png https://wolfstreet.com/wp-content/uploads/2020/07/US-Fed-Bal...

vmception 6y ago

nice, yeah thats something I find interesting too but the Fed's junk bond ETF purchasing has already been active. this article is about its investment grade primary and secondary market corporate credit facility, which was authorized with the CARES Act but took till June to get started.

cinquemb 6y ago
Yeah, nothing in default yet from EOD friday in LQD. Of about 2272 CUSIPS in LQD then, 58 are rated BB, Baa1 392, Baa2 406, Baa3 251. I expect that it will happen soon that at least a few of these go into default.
- vmception 6y ago
  Unless they directly issue to the fed and use the proceeds to pay off prior debt This is very commonplace in corporate credit, aside from issuing directly to the federal reserve, which has offered verbatim to be the sole investor! Free money! I read the whole CARES Act and found this extra large bailout to be the biggest market distortion and thought it should have more air time than PPP or unemployment insurance boosts
  - cinquemb 6y ago
    > Unless they directly issue to the fed and use the proceeds to pay off prior debt True, it could happen, but it would take away from the profits banks and secondary market participants get from issuing it directly them selling the debt to treasury dept leveraging fed bucks :P
    - vmception 6y ago
      haha thats also happening, the fed is operating two new programs Check it out Primary Market Corporate Credit Facility Secondary Market Corporate Credit Facility https://www.federalreserve.gov/monetarypolicy/pmccf.htm https://www.federalreserve.gov/monetarypolicy/pmccf.htm https://www.federalreserve.gov/monetarypolicy/smccf.htm https://www.federalreserve.gov/monetarypolicy/smccf.htm
      - cinquemb 6y ago
        Yup, i've been following the alphabet soup of insolvency for a while[0] [0] https://wolfstreet.com/wp-content/uploads/2020/07/US-Fed-Balance-sheet-2020-07-02-SPV-.png https://wolfstreet.com/wp-content/uploads/2020/07/US-Fed-Bal...