Tag Archives: high yield debt

A recession would threaten central banks’ independence

Central banks are again under the limelight. With Mark Carney’s departure as governor of the Bank of England next month, Boris Johnson could try to seize the opportunity to curtail the central bank’s independence.

This should not come as a surprise. Already, Johnson’s soulmate from across the ocean, Donald Trump, has been making noises about the Federal Reserve being too independent (or rather: insubordinate) for his liking.

So, if these two authoritarian populists go for central banks, what are their chances of bringing them under their rule?

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Central banks enabled populism; they will soon pay the price

It is becoming increasingly difficult for central banks to surprise the markets with good news. No matter how dovish they are, investors expect them to be even more dovish still. This financial repression has facilitated the rise of populist politicians, who threaten to bring the end of central banks’ independence.

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Central banks cannot paper over the cracks of populism

Central banks are trying to prolong the decade-old bull market, but it looks like instead of reassuring investors, this makes them nervous.

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What’s behind the Fed’s ‘whatever it takes’ moment

January was an extraordinarily positive month in the markets for virtually all assets, after a horrible 2018 — and it’s all due to the Fed. The US central bank executed a massive U-turn in its monetary policy and, while many observers like to point to low inflation as the reason for the Fed’s aborted effort to normalise monetary policy, something more sinister is behind it.

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The end of the debt bias is nigh

Corporate bondholders, beware. The wave of enthusiasm for this asset class, which has helped it to reach new heights, is now ebbing. A research paper recently published by the IMF illustrates the reasons behind this – although it must be said the paper does not represent the official position of the IMF.

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This will be a ‘summer of shocks’ or a ‘summer of stocks’

As investors ponder whether to “sell in May and go away,” strategists say we’ll either see a “summer of stocks,” or a “summer of shocks.”

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Investors ‘front-run’ the ECB, rush to buy bonds

If anyone was looking for more proof of how central banks’ actions are distorting the markets, here it is: investors are trying to “front-run” the European Central Bank (ECB) – in the words of analysts at Bank of America Merrill Lynch — by buying investment grade bonds.

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ECB announcement breathes life into debt funds

The European Central Bank helped credit as an asset class, and of course corporate bonds within it, become attractive to investors again.

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Five reasons why US stocks won’t crash after Fed rate hike

As the Federal Reserve’s Federal Open Market Committee (FOMC) starts talks on what is probably the most watched interest rate hike in history, the importance of getting it right cannot be over-emphasized.

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