Bloomberg: – BlackRock Junk-Bond ETF suffers record withdrawal as rally fades. – The five largest junk-bond ETFs, which allow investors to speculate on the securities without actually owning them, have lost $1.97 billion of assets since Sept. 20 as investors wager that a four-year rally in the debt is running out of steam. High-yield bonds in the U.S. are losing 0.14 percent this month after posting 12.9 percent returns this year through October, according to Bank of America Merrill Lynch index data.
CNBC: – Investors rush into munis to escape ‘Fiscal Cliff’. – Investors are barreling into municipal bonds, driving yields to record lows and hoping for a safe hiding place at a time when taxes are almost certain to rise.
Daily Finance: – NYSE Bonds Launches NYSE Bondwatch. – NYSE Euronext’s fixed income trading platform in the U.S., NYSE Bonds, today announced the launch of NYSE Bondwatch, a web-based tool that provides investors access to transparent, pre-trade pricing data on individual corporate bonds. Bond investors can now freely access this information and use it to help determine the current market for specific corporate bonds.
BondSquawk: HP bonds look good – In particular, management’s goal of improving the company’s credit profile via debt reduction should be a strong positive for bond holders.
Index Universe: How to avoid getting hosed on bond ETFs which trade at a premium or discount to NAV – Look at the premium/discount pattern for a fund before you buy it, and avoid buying at above-normal premiums. Similarly, unless you have some reason to believe your position is tanking and you simply have to be out now, wait for discounts to resolve before you press the “Eject” button on your position.
Bloomberg: – Fed says additional QE may be needed next year. – A number of Federal Reserve officials said the central bank may need to expand its monthly purchases of bonds next year after the expiration of Operation Twist, according to minutes of their last meeting.
MarketWatch: Treasuries rally slightly after Fed minutes – Yields on 10-year notes slipped 1 basis point to 1.59%, after touching 1.64% earlier. Yields on 30-year bonds 30_YEAR +0.04% erased a rise to trade at to 2.73%.
Financial Post: – Bond market betting Obama will fail to avert the fiscal cliff. – The biggest Treasury rally in five months is underlining market concern that President Barack Obama and House Republicans will fail to avert $607 billion in mandated spending cuts and tax increases starting Jan. 1st.
Bloomberg: – Harrisburg ex-receiver calls for ban on muni-swap deals. – Pennsylvania should ban the use of interest-rate swaps by municipalities and raise the bar for issuing debt to avoid the type of fiscal calamity that besets Harrisburg, the city’s former receiver told state lawmakers.
Insurance journal: – Sandy to have limited impact on catastrophe bond market. – Superstorm Sandy’s impact the catastrophe bond market is likely to be muted based on current estimates. The scope and scale of the storm makes it unlikely that any bonds will be triggered solely by Sandy; however if losses mount and early estimates prove wrong, some bonds could be at risk.
Cate Long: – Mapping the saga of San Bernardino. – San Bernardino is a broken city, whose finances have been mismanaged for years; they cannot exit bankruptcy without a plan to become solvent again. High salaries and overtime expenses for police and firefighters have to be addressed one way or another.
Learn Bonds: – The chart which shows the FED controls CD rates. – In this article we show National short term CD rates (6 month, 1 year, 2 year, 30 months) closely follow the FED funds rate which is controlled by the fed.
WSJ: – Post-storm push for muni bonds. – States and cities battered by superstorm Sandy are pushing Congress to allow private companies and nonprofit groups to borrow as much as $20 billion in the tax-exempt municipal-bond market, in a bid to spur the region’s recovery efforts.
Yahoo Finance: – Why muni bonds are suddenly so popular right now. – Investors are barreling into municipal bonds, driving yields to record lows and hoping for a safe hiding place at a time when taxes are almost certain to rise.
Commercial Appeal: – Industry group pushes to protect tax-free status of municipal bonds. – They’re a tax advantage for rich investors and a time-honored way of financing expensive public infrastructure improvements. But tax-exempt municipal bonds could become the baby that’s thrown out with the bath water of fiscal reform, some bond dealers and local government officials’ fear.
Barron’s: – New rules could mean fresh push for treasury-only money funds. – The money-fund overhaul that’s making news again this week would give the mutual-fund industry an incentive to push Treasury-only funds at the expense of prime money funds.
Bloomberg: – Coffin-maker collapse shows unrated bonds riskiest. – A coffin maker in West Virginia and a Colorado massage school have something in common: They were financed by unrated U.S. municipal debt that defaulted and lost investors money.
Gross: When nearly all asset mkts bubble, “default” choice becomes cash. Find attractive short term cash alts. Corp FRNs, 1-3 yr Italy/Spain
— PIMCO (@PIMCO) November 14, 2012
If you are part of the “so what if we go over” crowd, all you are doing is enabling political dysfunction.
— Bond Girl (@munilass) November 14, 2012
Bids remain firm on new issues, mostly from dealer desks with focus on retail and on deals that are pricing this week -ziegler on #muniland
— Taylor Riggs (@TaylorRiggs_BB) November 14, 2012
Message to @nygovcuomo … The Federal Reserve wants to keep buying assets. Convince Congress to get behind infrastructure bonds.
— Cate Long (@cate_long) November 14, 2012
“Yet even in bankruptcy, reducing pension costs by cutting benefits is not an option – at lease according to CALPERS”<END>
— MuniCredit (@MuniCredit) November 14, 2012