In response to the calamity caused by the GFC, interest rates were cut to near zero and we doubled the amount of debt outstanding. Fast forward and interest rates are now rising at the same time that ~$18 trillion of stimulus is being withdrawn. Show More
To illustrate how the PM Capital team searches for investment anomalies around the world, Jarod Dawson uses UK pub company Spirit, which generated the opportunity for a 25% return from a credit security. Show More
Richard Quin, Lead Portfolio manager of Bentham Asset Management, is one of Australia’s most seasoned and successful credit investors. While the asset class remains overlooked and underrepresented in many Australian portfolios, there are two bets he’s making right now that should grab your attention. The first position is that long-term... Show More
Andrew Lockhart from Metrics Credit Partners provides an insight into the domestic credit market. It’s part of the financial system usually reserved for the ‘big banks’ who provide credit to large corporates looking to invest and expand their businesses. While credit is available it seems appetite for growth remains patchy. Show More
Risk management, or the lack of it, is usually the key difference between the fortunes of banks when times get tough. History books are full of evidence of what went wrong after a financial calamity. That’s the easy part. The hard part is to foresee the problems. The high level... Show More
“The OECD concludes that Australia has the most over-valued housing market, with prices 52% above their ‘correct” level.“ Similar warnings continue as do the related dangers of investing in those financing the market – banks. The problem is the quote above is from December 2005. The point being, just because... Show More
The European Central Bank (ECB) has just started buying corporate bonds in Europe. This Show More
China’s bond investors are raking it in as an equity rout scatters cash into fixed-income securities. But concerns are rising that spreading defaults and a sliding yuan will spark a selloff. “2016 is a year when we will see systemic risks emerge in China’s credit market,” said Ji Weijie, credit... Show More
A recent spate of credit downgrades in the US has thrust high yield credit into the spotlight. The Fed will be acutely aware of the ructions taking place in credit markets with a number of high profile credit funds freezing investor redemptions and junk bonds providing negative returns for the... Show More
There is no shortage of bad omens for the global economy at the moment. To name a few: plunging commodity prices, wobbly equity markets, weak world trade, reduced profit forecasts for American companies and lower long-term inflation expectations. In recent weeks, a new one has joined the list: rising corporate-bond... Show More
Many market commentators say that Emerging Markets (EM) will be vulnerable as the Fed begins to hike rates. However, BCA throws cold water on these claims, saying “In the past, EM vulnerability has not stemmed from Fed tightening.” BCA says “Over the past 20 years, EM risk assets – stocks,... Show More
