U.S. Corporations: All Gain, No Pain?
by Editorial Staff
Updated: September 01, 2023
Good day, everyone, it's Murray Gunn here. And this month we've got some belting charts for you. Here's one you won't want to miss.
Despite an historic rise in bond yields in short-term interest rates, there really hasn't been much pain felt at all by corporate borrowers. One reason for that might be because corporates have yet to face refinancing challenges after locking in very low borrowing rates.
This chart shows the U.S. spread between the lowest rated investment grade corporate bonds and the second lowest rated. When the U.S. spread is going up, it means that the lowest rated investment grade bonds are underperforming and points to an increasing risk of downgrades to non-investment grade, or junk bond, status.
It's a good measure of sentiment, and you can see that fear of downgrades and defaults has risen in past worries over the economy.
So what is happening now? The answer might surprise you, so check out the article to find out.
Enjoy the issue and stay tuned to EWI for what will be a very interesting time ahead.
Bonds are in the driver’s seat right now
And they'll stay there for a while.
Many investors feel intimidated by bonds. But in reality, prices and yields move in predictable patterns -- Elliott wave patterns. When you track those patterns, you see what's next before that next move ever begins.
And not just in bonds. Stocks, energy, FX, cryptos -- our September 2023 Global Market Perspective updates you on 50+ of the world's biggest markets.
In a word, everything. From political conspiracies to Covid-related ones to the theories so bizarre that they seem too silly to be relevant, we live in the golden age of conspiracy theories. And while it’s easy to blame social media for their spread, we think the roots go deeper. Watch our new Mood Riff episode where the host Greg Eident explains some fascinating socionomic findings on the subject.
Sentiment indicators provide valuable information, yet they are best used in conjunction with Elliott wave analysis. Here's one time-tested indicator that has recently displayed a "big surge."
When you track historical patterns of foreign investments in U.S. equities, an important picture emerges. Watch as our Market Trek host Brian Whitmer walks you through a chart of the collective foreign buying interest going back to the 1990s and through today. (Brian's global destination is South Korea.)