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One of the most striking
features of the current economic environment is the number of charts and
graphs of statistical, price or other data that depict cliff-like drops or
moon-shot-like jumps. Today's example, highlighted by Jan-Martin Feddersen,
publisher of the immobilienblasen blog, can be found in a post entitled "Number Of The Day: 'Percentage Of US Companies With A Junk
Rating."
This at the start of
a deep and long recession...... After the events of the last 3 month it is
valid to wonder how much of this debt will get bailed out ( GM....) or will
end up without much disclosure on the Fed´s balance sheet......I wonder
how many companies are now on the brink of bankruptcy just because they
decided to make big debt financed stock buybacks or megalomaniac takeovers
& buyouts......
WSJ Junk-Bond Market Has Closed the
Door
Yields Upward of 20% Make It Too Pricey for Borrowers; Zero Deals Made It in
November
About 50% of U.S. companies have below-investment-grade credit ratings, making the $750 billion
junk-bond market a vital source of financing for car makers, airlines,
retailers, utilities, restaurant chains and media companies
>The next chart is
making things even scarier........ Within the "junk" label the
remaining "quality" has deterioting fast and furious especially
over the past few years..........
Michael J. Panzner
Editor, Financialarmageddon.com
Michael J. Panzner is a 25-year
veteran of the global stock, bond, and currency markets and the author of
Financial Armageddon: Protecting Your Future from Four Impending
Catastrophes, published by Kaplan Publishing.
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