city
yellow

DoubleLine Podcasts

MMM Episode 38: Boring Beige Book, Interesting Loans and Skyrocketing Breakevens

After reviewing the week’s positive performance for stocks, negative performance for bonds, a boring Beige Book and a limited crop of macro news, Jeff Mayberry and Samuel Lau turn to the Question of the Week (16:31): the ins and outs of bank debt, aka leveraged loans or senior loans. Credits in this $1 trillion+ market, Sam notes, sit atop their corporate issuers’ capital structures, in fact, “senior to bondholders, both senior and subordinated bonds.” Senior loans, he points out, are floating rate, potentially attractive in times of rising rates and economic growth. However, this asset class comes with unique features and risks not typically encountered with marketable securities, including trade settlements that can take up to two weeks.

During the podcast’s review of market activity for the week of Oct. 18-22, Jeff takes note of the five-year Treasury yield (3:02) closing about 120 basis points and asks whether that will form the new floor for this part of the belly of the curve. In a related development, Sam also discusses “skyrocketing breakevens” in the Treasury/TIPS market. For upcoming macro news for the week of Oct. 25-29 (32:44), the podcast co-hosts will be on the lookout Thursday for the preliminary GDP release for the third quarter and Friday for the personal consumption expenditure deflator, the preferred inflation indicator of the Federal Reserve.

The views and opinions expressed herein are as of the date recorded and should not be construed as an offer to buy or sell any securities. Such views/opinions may differ from those of DoubleLine Capital or other of its affiliates and are subject to change without notice. DoubleLine has no obligation to provide any updates or changes. The following audio presentations represent DoubleLine’s intellectual property. No portion of these presentations may be published, reproduced, transmitted or rebroadcast in any media in any form without the express written permission of DoubleLine. DoubleLine has no obligation to provide any updates or changes. To receive permission from DoubleLine please contact [email protected].

Neither DoubleLine nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the statements or any information contained in this podcast and any liability therefore (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed.

DoubleLine is not providing any financial, economic, legal, accounting or tax advice in these podcasts. The receipt of these podcasts by any listener is not to be taken as constituting the giving of investment advice by any DoubleLine entity or individual to that listener, nor to constitute such person a client of any DoubleLine entity. The portfolio risk management process includes an effort to monitor and manage risk, but does not imply low risk.

logo

DoubleLine

333 S. Grand Ave.
18th Floor
Los Angeles
CA 90071

213.633.8200

 

This is a Test!

DoubleLine is testing our emergency back-up plan. If this were a real emergency, DoubleLine would be posting news, updates, contact information, webcast or conference call information here to keep our clients updated on the situation. To contact DoubleLine, please click here.

×
 

Thank you for your request(s). You will receive slides after the webcast has started. Replay and Recap notifications will take several days following the compliance review.

×
 

    Please fill in your information below in order to open this article in your browser.

    I am an Institutional Investor [recaptcha]