Now It’s Even Worse Than it Was When Lehman Collapsed, But It’s “Contained”

[marmar]

Now It’s Even Worse Than it Was When Lehman Collapsed, But It’s “Contained”
by Wolf Richter • February 26, 2016


[font color="blue"]“Distress” in Bonds Spirals into Financial Crisis Conditions[/font]


The pile of toxic corporate bonds in the US, euphemistically called “distressed” debt, ballooned 15% in the single month of February to $327.8 billion, up 265% from a year ago, according to S&P Capital IQ. The number of S&P rated US companies with distressed debt rose 9% in February to 353, up 128% from a year ago.

The last time the pile of distressed debt had soared to this level was in November 2008, and the last time the number of distressed issuers had shot up to these levels was in October 2008; Lehman had declared bankruptcy in September.

These “distressed” junk bonds sport yields that are at least 10 percentage points above US Treasury yields, according to S&P Capital IQ’s Distressed Debt Monitor. Put into a chart, the fiasco in terms of dollars (in billions, black line) and number of distressed issuers (purple columns) looks like this:



And so Standard & Poor’s US Distress Ratio for junk bonds soared to 33.9 in February, from 29.6 in January, having increased relentlessly for nine months straight, nearly tripling from a year ago! .............(more)

http://wolfstreet.com/2016/02/26/distress-ratio-bonds-spirals-into-financial-crisis-conditions-lehman/

[onecaliberal]

1. Well it's just to hard to fix so we won't do a fucking thing about any of it.

After all the annointed one will tell them to knock it off and they will.

[tazkcmo]

3. Wrong attitude!

What's to fix? Remember, in Corporate Speak there are no "problems", just opportunities! Now lets go make some money!















sarcasm

[tazkcmo]

2. Woo hoo!

Where there's losers there are also winners! Just like TARP bailouts, economic "down turns" may hurt the little people but somebody will profit and that's the important thing! Yay Money!













sarcasm

[Turbineguy]

4. Most of this is in the oil patch.

Something like $250 billion.

You can prove anything with statistics.

[yourout]

5. That is what happens when you don't fix the underlying problem and just keep printing money.

Not one dime of bailout money should have been given until Glass-Steagall was re-instated and the big banks broken up.

[leveymg]

6. Hedge funds love crises, panics and crashes.

It's easier to make BIG money in a down market than in an up market - now, who said that?

[Human101948]

7. Mahatma Ghandi?

Did he play the market?

[leveymg]

8. ROFL - just got this image of him spinning a wheel and picking stocks to short.

Let's keep this to ourselves, shall we? It's been too good a thing to spoil now. . .

[MisterP]

9. Eli Black?