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OK…after listening to the Wealtheon Video below regarding High Yield ( Junk) Bonds vs US Treasuries
or in ETF lingo JNK vs TLT … I decided to plot JNK:TLT to see how Junk is faring against US Treasuries and ….WTF ?
Junk is APPRECIATING vs US 10 Year Bonds…a lot…and rapidly….so what’s that Spell ?
I am No Bond Guru BUT if Holding Junk is better than holding United States Debt…then United States Debt must be worse than Junk
Sir Fully,
Not really sure what companies’ bonds fall under junk … may be some digging can yield some names.
But imagine the bonds/notes/debt of companies like Google, Apple, Nvidia … they surely “deserve” to have higher rating than US Treasuries, as they are better managed fiscally.
GL
GL’s point above is a good one and makes sense. Part of the reason Junk is outperforming, is the desire by some in the investment community to seek outperformance/better returns. They will do so until the trend reverses and then they will rush to treasuries when the economy stalls and junk starts to under perform.
Thanks Sir CM.
I’ve known some, and always admired, private sector people who manage companies’ top line and bottom line. Turning a company around, making lossy sections profitable, trimming the lard … it is all done methodically, with fiscal responsibility entrusted to those individuals. Then, not only do the companies benefit, but also the outside shareholders.
Unlike the govt. which has unlimited unfunded liabilities.
Capitalism was what brought me to this country.
Just like neo-cons, one has to grow up in neo-socialism to understand where they stand a better chance.
GL
Here is all about Junk
A State Street Issue (note : 5 .6 Trillion Under Management )
https://www.ssga.com/us/en/intermediary/etfs/funds/spdr-bloomberg-high-yield-bond-etf-jnk
Off this weekend’s Wealthion with Rubino, here is an indepth pointer on Junk
https://www.youtube.com/watch?v=LdFq1aEITl4