After Samuel Lau and Jeffrey Sherman march through their mid-week macro-market-monetary menagerie, DoubleLine CLO analyst Joe Mezyk returns to the Sherman Show to discuss the state of the $750 billion market of collateralized loan obligations. In the wake of the market dislocations due to economic shutdown and massive intervention by the Federal Reserve, Mr. Mezyk observes a tale of two worlds in CLO Land. On one hand, there are securitized bonds backed by “good companies [which] will have the liquidity to ride out this pandemic.” On the other hand, generous liquidity is “putting extra debt on zombie companies.” In this juxtaposition of fundamental economic crunch and engineered liquidity boom, Mezyk discusses the “opportunities to pick through the ruble and find things we like.”
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