Answers emerge from the murky business of CLOs.
Central-Bank Forked-Tongue Syndrome.
Here are the 84 companies whose bonds the Fed bought, and the 16 bond ETFs it now holds.
Entire market of 3,451 stocks minus “Giant 5” is down 1% from Jan 2018. But wow, the volatility! You would have been better off with a despicable freaking savings account.
I’m sharing this trade for your future entertainment so you can hail me as the obliterating moron that infamously shorted the greatest rally floating weightlessly ever higher above the worst economic and corporate crisis imaginable.
Foreign holders, US banks, and US government funds all dumped. But two big players gorged on it – and one of them was the Fed.
US National Debt Spiked by $1 trillion in 5 weeks to $26 trillion. Fed monetized 65%. Business debts spike to high heaven.
What’s so insidious about the Fed’s bailouts of investors in hedge funds, mortgage-REITS, stocks, bonds, leveraged loans, and other often risky assets? The destruction of capitalism (transcript of my podcast).
Market worrying about a phenomenon much worse than stagflation?
Investors bet on this outcome for years. Covid-19 just sped it up by a few months. Department Stores Are Toast.