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Detroit Free Press: – Detroit prepares to file for bankruptcy as soon as Friday. – The City of Detroit is in final preparations to file for federal bankruptcy as early as Friday morning, several sources told the Free Press today.
Mebane Faber: – Is Gundlach right, have bonds bottomed? – A few weeks ago bond king and fellow Angeleno Jeff Gundlach mentioned that he thought bonds were near a bottom. Now I don’t know why his econometric analysis had led him to this conclusion, but history is certainly on his side, and we agree with him. We used to do a lot of posts on asset classes, drawdowns, and really bad months.
FT: – Rate fears drive convertible bond rally. – Demand for convertible bonds is expanding sharply as fears of rising rates have hit prices in traditional debt markets, while at the same time equity markets are bouncing to record highs.
Learn Bonds: – Crazy year for savings bonds in 2013: Junk hauler finds hidden stash while Treasury goes paperless. – Learn Bonds Marc Prosser looks at the state of the savings bonds market so far in 2013.
IndexUniverse: – Target date bond ETFs are the “right product at the right time.” – IndexUniverse Managing Editor Olly Ludwig caught up with Hougan for a chat about what to look forward to for the rest of 2013, specifically the outlook for fixed-income and emerging market ETFs—two of the worst-hit asset classes in June, as investors headed for the exits amid worries about rising interest rates.
Donald Van Deventer: – Hewlett-Packard company bonds: A risk and return analysis. – In this note we analyze the current levels and past history of default probabilities for Hewlett-Packard Company.
Yahoo Finance: – Short bonds: It’s the best trade in the market right now, says hoenig. – Jonathan Hoenig of Capitalist Pig, makes his case for an extended drop in the bond market (meaning higher yields) in the attached clip. “It took 30 years for interest rates to come down,” Hoenig explains. “I think it’s going to take more than two months for them to move higher.”
MoneyBeat: Goldman Sachs: – Buy German bonds; Sell U.S. Treasurys. – Goldman Sachs Asset Management believes it still can profit from buying German government bonds and selling U.S. Treasury debt, even as some analysts caution that one of the market’s most popular so-called relative value trades is getting frothy.
WSJ: – Advisers closing investment ranks. – More than a decade ago, advisers started moving to broaden their investment options to offer clients an array of pre-packaged strategies run by outside managers. That approach has steadily gained favor, but there are signs of a backlash that could divide advisers from clients.
Bloomberg: – SoftBank rating lowered to junk by Moody’s after sprint deal. – SoftBank Corp., led by billionaire Masayoshi Son, had its credit rating cut to junk by Moody’s Investors Service after completing its $21.6 billion acquisition of a controlling stake in Sprint Corp.
CNBC: – Government bond debate: ‘functionless’ or ‘tactical’? – After a broad sell-off in the bond market in May and June, investors disagree over the value of investing in government paper. Higher yields look attractive as a tactical play for some, but others told CNBC that sovereign bonds no longer act as a buffer to risk assets.
ETF Trends: – BulletShares bond ETFs gaining momentum. – Guggenheim BulletShares lineup of ETFs have started to gain some momentum. These products were designed to provide index exposure to the Corporate Bond and High Yield Corporate Bond spaces with a defined maturity or “term.” In other words, the underlying bond portfolios are held until the bonds mature, and these are structured in such a way in that all the bonds owned in a specific portfolio all mature during the same year.
Zero Hedge: – Muni retirees face 90% loss under Detroit’s pending “free-fall” bankruptcy. – The current plan (for now rejected by creditors) means a 90% loss for muni-worker retirees, 81% loss for unsecured creditors, and a 75% loss for secured creditors leaving a “free fall” bankruptcy filing.
FT: – Investors return to junk bonds in numbers. – Investors are returning to the riskiest corporate bonds in US debt markets in numbers, shrugging off recent sharp losses and record outflows from the securities in June.
The Market Oracle: – Municipal Bonds: While others bail, it might be a good time to buy. – Investors have been bailing out of beleaguered municipal bonds in droves, worried that higher interest rates will drive down the prices of the bonds.
Cate Long: – Who is the development bank of Puerto Rico’s rumored next president? – In the latest sign of Puerto Rico’s perilous financial footing, The Bond Buyer reported that the president of the Government Development Bank of Puerto Rico, Javier Ferrer, announced his resignation on Wednesday.
Gr8 10 yr Tips auction 1.5bp through
— Ed Bradford (@Fullcarry) July 18, 2013
After rising to 5.8%, the long-term avg, high-yield bond spreads to Treasuries are already back to 5.0%, the avg for 2013. #bonds
— AnthonyValeri (@Anthony_Valeri) July 18, 2013