News 

Economic uncertainty is rising — and there’s one move that can help investors weather the storm

“The shrinking high yield market is not part of the M&A boom, and many high yield firms are issuing via loans rather than bonds” writes Richard Turnill for businessinsider.com. Investment grade (IG) bonds typically outperform their high yield counterparts when uncertainty rises, given their higher quality and lower default risks.IG issuers’ greater global exposure versus high yield issuers may also be playing a role in these performance trends as trade tensions rise.Yet high yield issuance has slumped. Source: businessinsider.com Share This:

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Americans are taking on more of the burden for funding record U.S. deficits

“With the stock market seeing a sharp run-up last year, pension funds also need to shift those gains into bonds to rebalance their asset allocations” writes Sunny Oh for marketwatch.com. The responsibility for funding the U.S.’s yawning budget deficits is increasingly falling on the shoulders of domestic investors.When rates are falling, bond investors are more willing to snap up debt on the prospect that yields will fall even further, driving prices higher.Analysts hinted that Mnuchin may have been disingenuous as he neglected to mention that a bump in supply, but…

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Markets News 

CORRECT: Treasury announces plan to add 2-month bill to new issuance

“The Treasury Department announced Wednesday it plans to sell 2-month bill, adding a new security to its mix of notes and bonds” writes Senior Economics Reporter for marketwatch.com. Treasury also announced it will sell $73 billion in notes and bonds next week at its quarterly refunding auction, up from $66 billion at the last auction.The department will auction $31 billion in 3-year notes TMUBMUSD03Y, -0.09% on May 8 and $25 billion in 10-year notes TMUBMUSD10Y, +0.25% on May 9.The government will also sell $17 billion in 30-year bonds TMUBMUSD30Y, +0.77%…

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Crypto News 

JPMorgan, National Bank of Canada, others test debt issuance on blockchain

“Blockchain is in the early stages of development in the financial industry, but JPMorgan is optimistic about its potential, Farooq said” writes Midwest Communications Inc for 95kqds.com. The spin-off discussions are in the early stages and the bank has received interest from financial institutions and large enterprise technology companies, Farooq added.The platform was built over more than a year using Quorum, a type of open-source blockchain that JPMorgan has developed inhouse and is in discussions to spin off.JPMorgan is considering spinning off Quorum because the technology has attracted significant outside…

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OCBC Bank’s the first in Singapore to enable instant digital card issuance minutes after you apply for it

“OCBC Bank is the first bank in Singapore to enable instant digital card issuance and provisioning on Apply Pay via its mobile banking app” writes Jonathan Loh for businessinsider.sg. Mr Aditya Gupta, OCBC Bank’s head of E-Business Singapore, said: “Our customers can now receive their card digitally and provision it to their Apple Wallet to start paying with it straight away –  all from within our mobile banking app and within a few minutes.” “We believe this is a huge level-up in customer experience and will further accelerate our digital…

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Markets News 

Islamic bonds face ‘uncertain and muted’ 2018 amid central bank tightening and geopolitics

“Instead, Islamic bonds give investors a share in the ownership of an underlying asset rather than the ownership of debt and interest payments, as with conventional bonds” writes Holly Ellyatt for cnbc.com. Islamic bonds, or sukuk, saw strong issuance last year at $97.9 billion, up 45.3 percent from the $67.4 billion issued in 2016, according to data from the ratings agency.Islamic religious law prohibits the earning of interest (which is seen as a form of usury) so traditional western bonds are not acceptable. Source: cnbc.com Share This:

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The US may be where the bond bubble bursts thanks to ‘aggressive debt issuance,’ investor warns

“Several Wall Street observers have warned that a collapse in the debt market could be particularly nasty because current debt levels are so massive” writes Natasha Turak for cnbc.com. Rapidly mounting debt in the U.S. may be the trigger that bursts the bond bubble, one private equity investor told CNBC on Wednesday, echoing concerns of financial veterans Alan Greenspan and Paul Tudor Jones.”There is almost twice as much non-investment grade debt outstanding today as there was in 2007, and it’s about $2.4 trillion,” Kruse, who runs a U.S. distressed private…

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Crypto News 

Venezuela’s president says a pre-sale of its new “petro” cryptocurrency, with each token backed by one barrel of crude oil, will begin on February 20

“That would put the value of the entire petro issuance at just over $6 billion” writes unknown author for cnbc.com. The government has said that the petro issue will help the cash-strapped country make financial transactions and overcome U.S. sanctions against Maduro’s socialist government.A pre-sale of Venezuela’s new “petro” cryptocurrency will begin on Feb. 20, President Nicolas Maduro said on Tuesday, a move that the government hopes will help pull the country out of a dire economic crisis.Maduro has previously said Venezuela will issue 100 million tokens, each valued at…

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Oxford University is planning to issue its first-ever bond

“The move comes as U.K. universities step up their bond issuance in response to cuts in government funding” writes Ciara Linnane for marketwatch.com. Oxford University, alma mater to a raft of U.K. prime ministers, former U.S. President Bill Clinton and Nobel Prize–winning physicist Albert Einstein, among countless notables over its nine centuries of history, is planning its first-ever bond issue, and it can expect to price it on good terms.The university’s revenue is diversified, thanks to the success of the Oxford University Press, a publisher that accounted for 40% of…

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Markets News 

Companies rush to sell bonds to get ahead of tax plan, sparking ‘carnage’

“In October alone, high-grade issuance hit a monthly record of $131 billion” writes Sunny Oh for marketwatch.com. Highly rated U.S. corporations issued around $33 billion in debt in the first three days of the week.The selling in the market for high-grade corporate debt surprised some observers as the initial tax proposal would have only affected a small group of companies.Corporations are trying to issue debt ahead of any tax changes taking place,” said Dominic Pappalardo, director of the taxable-portfolio management team at McDonnell Investment Management.As lawmakers haggle over the details…

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