https://www.zerohedge.com/markets/blain-i-am-convinced-debt-markets-are-about-blow
I am more and more convinced the Debt Markets are about to blow up. It will start with a small wobble.
what the hell does he mean wobble.
look at the bullshit ipo implosion.
look at the credit downgrades from ig to junk.
look at the abs thats now all shit.
these arent wobbles. this is an implosion.
Or maybe it will start with a trickle of investors looking to sell corporate debt, discovering just how illiquid the market is and panicking, causing a massive avalanche of bond misery.
They arent selling. and they know what's on each other's books. that's part of the repo disaster. like here:
If/when any of these happen, then bond market holders will be left holding massive losses on low yielding assets.
negative real yields. that's the hilarity of it.
Over the past 10-years the bulk of that risk has been transferred out the banks into fund management – real money insurance and pension savings.
genius.
And, although investors will take losses, these will largely be mark-to-market and income rather than defaeult
In reality, what are those marks? garbage.