Last Two Times this Happened, it was Mayhem

[marmar]

Last Two Times this Happened, it was Mayhem
by Wolf Richter • November 13, 2015


[font color="blue"]Moody’s Warns about Credit Crunch, Unnerves with Parallels to 2008![/font]

The US bond market has swollen to $40 trillion. Over $8 trillion are corporate bonds, up a mind-boggling 50% from when the Fed unleashed its zero-interest-rate policy and QE seven years ago.

So far this year, $1.34 trillion in new corporate bonds have been issued, up 6.8% from last year at this time, which had already been a record year, according to the Securities Industry and Financial Markets Association (SIFMA). Bond issuance in 2012, 2013, and 2014 set ever crazier records; 2015 is on track to set an even crazier one: close to $1.5 trillion.

That’s a lot of newly borrowed moolah. Much of it is being used to pay for dividends, stock buybacks, M&A, and other worthy financial engineering projects designed to inflate stock prices, though that strategy has turned into a sorry dud this year.

Junk bonds now make up $1.8 trillion of this pile of corporate debt, nearly double the $944 billion in junk bonds outstanding at the end of 2008 before the Fed saved the economy, so to speak. ...............(more)

http://wolfstreet.com/2015/11/13/moodys-warns-about-looming-credit-crunch-unnerves-with-comparisons-to-2008-2009/

[Wellstone ruled]

1. What is of more concern is

the Derivatives total floating around the Electronic Markets. No one really knows,nine times total bonds,900 times total bonds. And,now the Saudi's are in finical melt down mode,and with the Commodity Market in full crash mode. Going to be interesting the next sixty days.

[erronis]

2. So, we didn't learn. Or perhaps the thieves learned that they are safe.

No prosecutions and jail time for the head honchos. OK, slap my wrist and I'll let go of a few million for your federal prosecution news bite.

[valerief]

3. Sounds like the latter. I knew the bastards wouldn't let me keep my

retirement savings.

[rurallib]

4. And no one will talk about this.

instead we talk about walling in the country or somebody's delusional visions of a supreme being picking him to be leader.