Return to Sender…Detroit Proposal Has Big Implications For Munis….Why Worry About the Bond Market… and more!

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Market Oracle: – US Treasury bonds will be returned to sender. – A new trend has begun to show itself. While the West, in particular the United States, is locked with focus on maintaining a stable US Treasury Bond yield, the East is preparing wide channels to send toxic US Bonds back to London and New York.

Bloomberg: – Detroit proposal has big implications for muni bond market. – Detroits proposal to force investors to take less than they’re owed on general-obligation debt would “have a major impact on the bond market,” according to Richard A. Ciccarone, chief research officer at Oak Brook, Illinois-based McDonnell Investment Management LLC.

BBC: – Why worry about the US bond market? – If you’re not an economist or a bond trader, you might wonder why there should be such a fuss about roughly half a percentage point rise in the interest rates on US 10-year government debt. Stephanie Sanders looks at the implications of rising bond yields, good and bad.

Learn Bonds:  – Bankers to Fed – We are concerned about an unsustainable bubble.  – The financial media, financial advisors, and portfolio managers, as a collective group, have been calling the bond market a bubble for quite some time. So the Federal Advisory Council (FAC’s) mentioning that possibility is really no surprise. But what is surprising is the FAC’s expressing concern about an equity bubble.

Business Insider: – Stocks and bonds can keep rising together — for now. – Stock prices and bond yields have historically had a love-hate relationship that would make the romantic ups and downs of any soap opera seem mild by comparison. But currently the relationship remains tight and far from crossing the line that would lead to a breakup.

FT: – Quant hedge funds hit by US bonds sell-off. – Some of the world’s biggest quant hedge funds have suffered steep losses in the past two weeks following the sell-off in US bond markets.

Benzinga: – Traders finally discover obscure inverse junk bond ETF. –  There are plenty of inverse ETFs on the market today. Maybe too many in the eyes of those that enjoy critiquing these bearish funds. There are even inverse ETFs for the Australian dollar and Mexican stocks, but for junk bonds? Who knew?

FundWeb: – Good times flow as bonds party on… – Corporate bonds have confounded the most pessimistic forecasts this year as investors continue to show a thirst for the product but will they end up with a hangover when the party ends?

FT: – Bankers turn sunshine into bonds. – Sliced and diced assets are about to get their moment in the sun. Bankers say they are close to turning sunshine into bonds for the first time, highlighting how exotic securities are shedding the toxic image they gained in the financial crisis amid fresh innovation.

NASDAQ: – Why it can be cheaper to hedge junk bonds than Treasuries now. – A look at the cost of hedging TLT and JNK against greater-than-13% drops over the next several months.

Bloomberg: – Biggest ETF alluring at deepest discount since ’11. – The largest exchange-traded fund tracking the US municipal market is selling at its biggest discount to its underlying assets in almost two years. If history is any guide, that signals a buying opportunity.

ETF Trends: – Short-duration bond ETFs in spotlight on SEC money fund proposal. – The SEC on Wednesday announced a proposal that would require institutional money market funds to move to a floating net asset value. The regulator was also proposed liquidity fees and temporary halts of redemptions for money funds in certain situations.

David Fabien: – Stocks, bonds, and gold: Where do we go from here? – Over the last month, the market has taught us a great deal about volatility. Stocks have finally started to waver, bonds got crushed in May, and gold has continued to teeter sideways. No matter how you are playing these three key segments of the market, remember that this volatility can be used as an opportunity for your portfolio.

Investing.com: – Junk bond correction. – Two corporate high-yield ETFs, which show the junk bond market is in correction mode.

ETF Trends: – Muni bond ETFs slip on rate concerns. – The largest municipal bond ETF is down about 3% the past month as yields move higher on talk the Federal Reserve may soon begin tapering its bond purchases.

Indexuniverse: – Vanguard lists int’l and EM bond ETFs. – Vanguard, the third-largest ETF provider by assets, today launches both its new international bond ETF fund and its emerging markets bond ETF, ending years of waiting for the firm that pioneered retail index investing to move into some of the most popular and unexplored pockets of the investment markets.

Forbes: – Meredith Whitney on the future of muni bonds. – Meredith Whitney has a new book to sell, Fate of the States: A New Geography of American Prosperity. Despite the fact she’s already admitted muni bonds aren’t her ‘speciality’, it didn’t stop her sitting down with Steve Forbes to talk about municipal bonds and what they mean for the future of taxes, pension funds and schooling.




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