Home Gross: High Yield Defaults Are Coming…Buy TIPS Now?…3 Must-See Junk Bond Charts…and more!
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Gross: High Yield Defaults Are Coming…Buy TIPS Now?…3 Must-See Junk Bond Charts…and more!

Simon G

Bloomberg: – PIMCO’s Gross: Irrational exuberance leads to higher defaults in high yeild. – Bill Gross, talks to Erik Schatzker and Stephanie Ruhle on Bloomberg Television’s “Market Makers,” about the outlook for US Treasuries and junk bonds.

About.com: – Should you buy TIPS now? Two experts urge caution. – In a recent article, Jeff Reeves editor at InvestorPlace.com writes that individual TIPS bonds may be useful for capital preservation but little else. “Yes, TIPS are very low-risk and provide an inflation hedge,” he writes. “But they don’t offer much upside amid modest inflation and the threat of higher rates in the near future. Investors need to remember this before they plow too much into TIPS.”

BusinessInsider: – 3 must-see charts on the raging bull market in junk bonds. – Morgan Stanley’s Vincent Reinhart and Matthew Hornbach look at the scene in corporate credit and determine that the market might be “modestly rich” rather than straight-up “overheated.” Three charts from their work stand out, that nicely call into question the idea of a bubble.

Learn Bonds: – High Yield corporate bonds month in review – February 2013. – In the world of fixed income, investing in high yield bonds is what’s currently in vogue.  And it’s understandable given the desperate search for yield in today’s ultra-low-interest-rate environment.  Due to the popularity of high yield corporate bonds, I thought it might be useful to provide a look at some of the high yield market’s internals from the month of February.

Bond Buyer: – Investors see opportunities in taxable munis. – The taxable municipal bond market is attracting buyers as the tax-exempt municipal bond market and other taxable asset classes look expensive.

Money Week: – What bond markets are telling us. – Merryn Somerset Webb discusses with MoneyWeek regular James Ferguson what the recent surge in US Treasury yields tells us about investors’ fears.

Money Marketing: – Henderson’s John Bennett warns fixed income investors are ‘doomed’. – Henderson director of European equities John Bennett believes fixed income investors are likely to face a stealth bear market and a possible collapse in bonds.

ETF Database: – Using municipal bond ETFs to avoid tax hikes. – Nothing rings more true than Ben Franklin’s famous quote, “In this world nothing is certain but death and taxes.” Looking past the morbid side of that statement, higher taxes are almost certainly coming in the next few years, regardless of who is in office, as local counties, states and the federal government all look to fill their dwindling coffers. The good news for investors is that there is a partial solution to all of this – municipal bonds.

WSJ: – Treasurys slide as stocks rally. – Treasury bonds lost their safe-haven allure as improving gauges of performance in global service sectors pushed U.S. stocks to all-time highs.

FundWeb: – Corporate bond liquidity risks to fall in 2013, survey finds. – Fixed income managers are less worried about liquidity risk in corporate bonds in 2013, according to a recent survey by Aviva Investors. The survey found only 20 per cent of respondents regarded liquidity risk as the biggest threat to corporate bonds in 2013 – compared with 77 per cent in 2012 – with 95 per cent expecting positive returns of up to 10 per cent for corporate bonds for this year.

Zacks: – Zacks top ranked corporate bond ETF. – Within the current economic backdrop, investors seeking exposure in the investment grade corporate bond space in the wrapper of an ETF should consider the following Zacks top ranked bond ETF.

Bloomberg: – Whoever wins Los Angeles higher debt price signaled. – Los Angeles bonds are beating the $3.7 trillion municipal market even as leading mayoral candidates oppose a measure to raise the sales tax while also vowing to eliminate a $450 million-a-year business levy.

Sunlight: – New rule takes on pay-to-play in muni bonds. – Sunlight has long been an advocate for not only improved transparency of government institutions but also for thoughtful transparency measures that has open data standards in mind. Today we submitted a letter to the Municipal Securities Rulemaking Board (MSRB) supporting a proposed rule change that would give voters more information about who is trying to influence bond ballot issues.

Fox Business: – Companies raise cash in bond market as Dow hits new peak. – New highs in the stock market provided a stellar backdrop for companies selling large bond issues, as the Royal Bank of Canada (RY) and Berkshire Hathaway Inc.’s (BRKB) Burlington Northern Santa Fe railroad borrowed cash from investors.

https://twitter.com/PIMCO/status/308949815444766720

https://twitter.com/DavidSchawel/status/309010844514144258

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