Daily Digest

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Daily Digest 2/3 - Corporate Distress Deepens, Brazil Industry Drops Most In 12 Years

Wednesday, February 3, 2016, 11:01 AM

Economy

Corporate Distress Deepens as Emerging Bond Spread Widens

Companies in developing nations face more than $7 of bond repayments this year for every $1 their governments must return. That’s making investors nervous.

Moody's: US corporate defaults to hit six-year high in 2016 as commodity fallout continues

The US speculative-grade default rate rose to 3.2% from 2.7% in the fourth quarter of 2015 and will likely climb to a six-year high of 4.4% this year, as the drop in prices continues to pressure cash flows in commodity sectors, says Moody's Investors Service.

Inside the Fed's `D-Day' War Games for Breach of U.S. Debt Limit

In one fictitious scenario discussed in a slide presentation dated April 2013, the president would sign a bill into law giving priority to the payment of Social Security, veterans’ benefits, and the principal and interest on government debt.

Emanuel heads to Wall Street after CPS bond deal postponed (Chicago)

The school system's $6 billion of outstanding debt has been lowered deeper into junk by three major credit companies in the last three weeks. The district has to put money into a fund to cover its debt payments on Feb. 15, and it planned to use some proceeds from the delayed deal to “support near-term debt service,” Moody's said in its Jan. 29 report.

U.S. Treasury expects to borrow $250 billion in first quarter

The Treasury said in a statement it expects to issue $250 billion through credit markets during the period, up from an initial estimate of $165 billion.

ECB Bought 62.4 Billion Euros in Bonds in January as QE Reviewed

Holdings of public and private-sector debt under QE climbed to 712.3 billion euros last month, data on the ECB’s website showed on Monday. Of that, 544.2 billion euros was public-sector debt, with 150.5 billion euros accounting for covered bonds and 17.6 billion euros for asset-backed securities.

Negative Yields From Paris to Tokyo Draw Investors to U.S. Debt

After the Bank of Japan cut rates below zero last week, yields on more than $7.1 trillion of government debt globally are negative, while yields on U.S. investment-grade and junk bonds are rising to their highest levels in four years.

Worst Asian Junk Bond Start Since 2008 Limits Lippo Debt Revamp

The worst start for Asian junk bonds since 2008 doesn’t bode well for issuers’ efforts to negotiate some slack on repayment terms.

China Unleashes New Steps to Control Financial Risks, Outflows

China’s government is stepping up efforts to ward off a potential financial crisis, warning bank executives that their jobs are on the line unless they control risks and putting restrictions on an increasingly popular way of evading capital controls.

China Will Probably Tighten Capital Controls, SocGen Says

If 65 million residents, or about 5 percent of the population, each took the maximum allowed $50,000 out of China that would wipe out the $3.3 trillion of reserves, Jason Daw, head of Asian currency strategy at the French lender, said in an interview in Singapore. China needs a stockpile of at least $2.8 trillion to cope with a balance-of-payments crisis, Societe Generale estimates based on the International Monetary Fund’s methodology.

Brazil Industry Drops Most in 12 Years With December Surprise

Latin America’s largest economy is sinking into its deepest two-year recession in more than a century. That prompted the central bank to refrain from raising borrowing costs last month and encouraged President Dilma Rousseff to unveil a $21 billion package of stimulus lending to shore up investment and prevent further job losses.

Japan's Central Bank Isn't Out of Options Yet, Abe Aide Says

“I don’t think that’s the case,” Deputy Chief Cabinet Secretary Hiroshige Seko said when asked in an interview whether BOJ policy making was nearing its limits. “There are other central banks that have introduced lower negative interest rates,” he said. “This is not the last resort.”

Gold & Silver

Click to read the PM Daily Market Commentary: 2/2/16

Provided daily by the Peak Prosperity Gold & Silver Group

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

5 Comments

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Dr. Catherine Shakdam

And I agree on the causes of the migration crisis. 
The genocide of two peoples, the Syrians the Europeans. 
I have lost all appetite for leniency towards Cultural Marxists. 

https://www.rt.com/op-edge/331173-migrants-eu-globalization-crisis/

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
And another Muslim Woman.

And a Muslim woman points the finger at horse-face.

Is there not a man amongst us?

https://www.rt.com/news/331209-italian-woman-kerry-isis/

error: it was a female Italian freelance  journalist. 

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
Joined: Jul 30 2009
Posts: 4238
Yields in downsized Chicago school bond issue hit 8.50

Yields in downsized Chicago school bond issue hit 8.50 ...

Reuters-8 hours ago
Legislation allowing the Chicago Public Schools (CPS) to file for Chapter 9 municipal bankruptcy was introduced in January with the backing of Illinois Governor ...
Time2help's picture
Time2help
Status: Diamond Member (Offline)
Joined: Jun 9 2011
Posts: 2888
saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
Joined: Jul 30 2009
Posts: 4238
Rate cut prospects grow as big central banks adopt a dovish tone

Rate cut prospects grow as big central banks adopt a dovish tone

Reuters-4 hours ago
FRANKFURT, Feb 4 The world's central banks have all but given up hopes they can return to conventional monetary policy soon, openly touting more easing ...

China's Debt Default Risk Climbs to Highest Since June 2013

Bloomberg-11 hours ago
The cost of insuring Chinese sovereign debt against default climbed to the highest level since a record cash crunch in June 2013 as a slowing economy erodes ...

default may be Venezuelans' best hope

Financial Times-35 minutes ago
Yet despite the complete failure of his policies, Mr Maduro has made it a priority to meet payments on sovereign debt, even at the cost of squeezing imports ...

Black-Market Bolivars Crash Past 1000 Per Dollar in Venezuela

Bloomberg - ‎20 hours ago‎
Last year, Venezuela's central bank sued to block the popular U.S.-based website from publishing what it says is a misleading black-market exchange rates for dollars, claiming the move is part of a conspiracy to manipulate the South American country's ...

Bank of England cuts growth forecasts and leaves rates on hold - as ...

The Guardian-3 hours ago
Rolling coverage of Mark Carney's press conference, after the Bank of England cuts its UK growth forecasts and warns that the global economy is weakening.
 

EU on brink of 'terrifying crisis' Five of Europe's big banks near ...

Express.co.uk-3 hours ago
Last month, the head of the European Central Bank Mario Draghi raised expectations that it could undergo yet more Quantitative Easing in March - in effect ...

U.S. Companies at Risk of Default Near Crisis Peak, Says Moody's

Bloomberg-22 hours ago
... on their debt is nearing a peak not seen since the height of the financial crisis. .... In the previous quarter, Franklin saw investors pull $28 billion, the biggest ...

US junk debt rated triple C yields 20%

Financial Times-3 hours ago
Yields, which move inversely to prices, on debt issued by US companies that carry ... The sharp drop in commodity prices and a rising expectation of defaults by ...

US regulators expected to classify more energy loans as high risk

Reuters-19 hours ago
While credit ratings agencies are forecasting rising debt defaults, the fallout is expected to be less severe for leveraged loans than high-yield bonds, which have ...

Companies gamble; pension funds take the hit

The Economist (blog)-4 hours ago
Of course, the pension promise remains. But the longer that funds stay in deficit, the more likely it is that some will go bust with a shortfall. That will send workers ...

US layoffs surge to 6-month high: Challenger

CNBC-3 hours ago

Layoffs surged in January to the highest levels since July as employers in the retail and energy sectors pulled out the pink slips, according to a private survey out .

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