Bond Markets

Despite concerns about a liquidity crisis brewing in fixed-income markets, BlackRock’s Richard Prager, No. 2 on II’s Trading Technology 40, believes it is “more of a plumbing problem.”
Global bond markets move to tax savers; Trump, Sanders victorious in New Hampshire; U.S. food services giant files for IPO; Deutsche said to be buying back debt.
October’s market turmoil was triggered by several factors, from scarce liquidity to a broken system for trading corporate credit.
International investors now control a big share of EM bond markets, leaving those economies more vulnerable to outside events.
To sustain government spending, Ecuador is turning to the international capital markets. But the country must placate global investors, who got burned five years ago when it defaulted on two bond issues.
Also known as hybrid bonds, perpetual bonds are seeing their highest level of issuance in almost a decade as big corporate offerings hit the market. Investors of all stripes like these bonds because with interest rates near zero, they can yield 4 to 5 percent.
The European Central Bank’s massive lending scheme — the long-term refinancing operation, or LTRO — has eased the pressure on European banks without solving their underlying problems.
For investors, the question is whether a bankruptcy statute for states would bring some reassurance to an anxious bond market.