US corp distress could mean big bankruptcies-report

[Pale Blue Dot]

Source: Reuters

NEW YORK, July 28 (Reuters) - The amount of U.S. investment-grade bonds trading at distressed levels has risen close to an all-time high, a sign that a wave of mega-bankruptcies is likely on the way, a veteran high-yield strategist said.

Bonds are considered distressed when their yields, which move in the opposite direction of prices, exceed 1,000 basis points over those on U.S. Treasuries.

The distressed trading levels in both investment-grade and speculative-rated bonds "suggests that we will see record-sized bankruptcies by volume into 2009-2010," said Christopher Garman, writing in high-yield research publication Leverage World.

About 1.8 percent of high-grade bonds by par value are trading at distressed levels, slightly under an all-time high of 2.4 percent, according to Garman, publisher of Leverage World and former head of high-yield strategy at Merrill Lynch & Co Inc.

..."The largest corporate bankruptcies on record often follow this level of distress," Garman said.

Read more: http://www.reuters.com/article/bondsNews/idUSN2847036220080728?sp=true

[marmar]

1. Circuit City? American Airlines? The state of Florida?

It's going to be :scared: out there.....

[Demeter]

2. Mega-Bankruptcies. Is This a Great Country or What?

[notadmblnd]

3. What? someone means to tell me that all those other countries corporate America has sent our jobs to

aren't buying their products and increasing their profits? Boy I'm surprised!:sarcasm:

[AwakeAtLast]

4. I'm sure it will all be blamed on Obama and the Dem majorities

unless people wake the hell up.

[kirby]

5. 1000 basis points = 10% over treasuries

Just for those who dont know that a basis point is 1/100 of 1%.

[jwirr]

6. The repubs have dismantled FDR's safety net for the poor and never

realized that they were also dismantling their own safety net when they deregulated all the businesses. The banking and lending regulations that were instituted by FDR were put there to prevent another Great Depression not to prohibit free enterprise. Now they have freed themselves only to fall into bankruptcy themselves. We need to get the rule of law back into all aspects of our nation so that we can once more live in stability.

[dysfunctional press]

7. as long as the corporati permeate and control both political parties- we are screwn.

maybe the aliens will straighten things out when they arrive en masse on 12-21-2012...or something.



i really need a vacation.

[Yavin4]

8. Bush Is Going Out With A Bang

And he's taking us all down with him.