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Corporate bonds may be paying too little spread to offset fourth-quarter selloff risks

“Risks of a U.S. corporate bond selloff often run high into the final months of the year when liquidity can get pinched and credit spreads widen” writes Sunny Oh for marketwatch.com. The week also saw several additional warnings about corporate leverage, with the International Monetary Fund pointing to a potential $19 trillion corporate debt mess if the next recession is half the magnitude of the 2007-2008 crisis.Check out: Credit-rating firms raise more alarms about the weakest corporate borrowers Bank of America Merrill Lynch analysts estimate the net amount of bonds that have received downgrades versus upgrades stood at $73 billion in the past three months, with $25 billion of that coming from the energy sector.
 
Source: marketwatch.com



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