One would think that they had utterly lost their reputation for honesty — not to mention competence — by pasting AAA
ratings on junk mortgages as prime enablers of the present global financial crash.
The idea was to save the ratings agencies from having to take responsibility for the tens of billions of dollars lost as a result of their past AAA
ratings on junk mortgages.
As default
rates on junk - rated debt is above nine percent, companies with junk status face an average interest rate that is a whopping ten percent points above Treasuries — these days, that translates into roughly 12 percent for a five - year loan.
If
the rates on junk went negative, it would be an indication that either the ratings system is broken or dogs & cats are living together, mass hysteria.
As default
rates on junk - rated debt is above nine percent, companies with junk status face an average interest rate that is a whopping ten percent points above Treasuries — these days, that translates into roughly 12 percent for a five - year loan.
Default
rates on junk bonds normally peak late in recessions or in the year after it ends.
Defaults always decrease during good times and skyrocket during severe recessions, so with the U.S. now at risk of falling into a recession, analysts are predicting that the default
rate on junk bonds may climb to 5 % next year.
Not exact matches
Beyond the requirements that liquidity and regulators impose
on us, we will purchase currency - related securities only if they offer the possibility of unusual gain — either because a particular credit is mispriced, as can occur in periodic
junk - bond debacles, or because
rates rise to a level that offers the possibility of realizing substantial capital gains
on high - grade bonds when
rates fall.
Just as significant as the
ratings downgrades may be the suspension
on Friday of the creditor talks in Greece — whose debt S. & P. long ago gave
junk status.
With a focus
on transparency, customer service, and responsible lending, Breakout offers unique features with each and every loan: Early repayment benefits, graduation
rates, no double dipping, and no hidden or
junk fees.
Moody's Investors Service
on Tuesday downgraded Tesla's corporate family
rating to B3, six levels into
junk, and said its outlook
on the company is negative.
Almost all of the processes that used to require a mail response are completely online now, and the USPS today is essentially one big
junk mail courier for companies wanting to advertise at a 1.4 percent conversion
rate on average.
When people see banks browbeating the bond
rating agencies and accounting firms to whitewash the quality of what they're pawning off
on their customers, when they see bank lobbyists getting Washington to block state prosecutions of financial fraud so as to clear the way for more predatory lending and false packaging of the
junk securities they're selling and to win the right not to reveal their true financial position, there's a good reason not to buy what's in these black boxes.
Some 5.7 % of corporate
junk bonds from emerging markets are trading at prices below 70 cents
on the dollar, more than double the
rate for higher - risk U.S. bonds, according to JPMorgan.
Moody's Investors Service also downgraded Tesla's credit
rating further into
junk on Tuesday.
For example, Overseas Shipholding Group (equity ticker OSG) is a deeply
junk rated oil tanker company that has seen its bonds drop from trading around par (par means 100 cents
on the dollar when comparing the market price to the face amount of the bonds) to distressed levels between 60 and 70 cents
on the dollar.
Relatively high debt loads as featured
on pretty much every
junk -
rated issuer's balance sheet must be serviced with cash.
Spreads
on the lowest quality segment of the «
junk» bond category, «C»
rated bonds, have narrowed by an extraordinary 30 percentage points since late 2001, to around 5.5 percentage points.
For example, in a world where short - term interest
rates are zero, Wall Street acts as if a 2 % dividend yield
on equities, or a 5 %
junk bond yield is enough to make these securities appropriate even for investors with short horizons, not factoring in any compensation for risk or likely capital losses.
Telsa shares finally get sold — from $ 360 down to $ 260 — Tesla bonds downgraded by
rating agency to
junk — Questions about production remain — Autopilot accident (why is autopilot allowed
on major roads?)
The recent
ratings downgrades by both Moody's and S&P Global Ratings have placed the State of Illinois general obligation bonds on the edge of becomin
ratings downgrades by both Moody's and S&P Global
Ratings have placed the State of Illinois general obligation bonds on the edge of becomin
Ratings have placed the State of Illinois general obligation bonds
on the edge of becoming
junk.
Standard & Poor's
on Jan. 25 cut Illinois» bond
ratings one notch to A-minus, four notches above
junk status.
In an unexpected move, Standard & Poor's cut its sovereign debt
rating on Turkey further into
junk territory
on May 1, citing widening concern about the outlook for inflation amid a sell - off in the Turkish lira currency.
A week later, Moody's cut its
rating on MF Global to a notch above
junk, pointing to the European debt holdings.
«
Junk DNA» was introduced in 1972 by geneticist Susumu Ohno who noted that the mutational load from harmful mutations placed an upper limit
on the number of functional loci that could be expected given a typical mutation
rate.
While Texas's childhood obesity
rate does remain stubbornly high, what would it look like today if the TSNP hadn't been in place for the last decade to curb the worst
junk food
on school campuses?
Yes, school meals in France are indeed superior to ours, but that's reflective of a government so supportive of raising good food citizens that it actually provides state - sanctioned «taste training» to all preschoolers, puts warnings
on junk food ads, and funds school meals at a far higher
rate than our own government.
Standard and Poor's joined Moody's Investors Service in dropping Rockland County's credit
rating level
on Friday, June 29, putting the county at just above
junk status.
«The latter included China's stock market collapse and its global repercussions and effects
on commodity prices; the Aug. 11 devaluation of the renminbi; the downgrade of Brazilian debt to
junk status by Standard and Poor's
on Sept. 9; and the major uncertainties surrounding the possible increase of the U.S. Federal Reserve funds
rate.
Testimonials
on Naturally Savvy for Unjunk Your
Junk Food Testimonials
on Amazon.com for Unjunk Your
Junk Food (4.5 out of 5
rating from more than 60 reviews)
0:00 — Intro / In - House Stuff 9:55 — Headlines: Oscar
Ratings Up 14 %, RIP Corey Haim, Avatar Re-release, Hugo Weaving is Red Skull, Jemaine Clement and Sacha Baron Cohen for MIB 3, Shutter Island Stabbing 36:05 — Review: Green Zone 58:15 — Trailer Trash: Iron Man 2, Tron Legacy, Legend of the Guardians 1:06:25 — Other Stuff We Watched: No Impact Man, Night Court, The Fall Guy, Bigger Than Life, The Philosopher Kings, Hot Tub Time Machine, Up in the Air, Whip It, The Pacific, The Marriage Ref 1:32:45 —
Junk Mail: Don't Go Changin»
On Me, Cop Out vs. Hot Fuzz and Pineapple Express, Zoning Out and 3 - D, Supporting Roman Polanski, Blu - ray Quality, VBS.tv and Vice Guide to Travel 1:54:00 — This Week's DVD Releases 1:56:00 — Outro
0:00 — Intro 4:45 — Review: Silver Linings Playbook 33:45 — Review: Life of Pi 52:50 — Other Stuff We Watched: Holy Motors, The Queen of Versailles, Anchorman, Rudy, Sunset Boulevard, Cyborg, 3 Women, I Heart Huckabees, The Fighter, Three Kings, Flirting with Disaster, Spanking the Monkey, Touch of Evil, The Ipcress File, Tombstone 2:06:35 —
Junk Mail: Best Musical Moment in a Non-Musical, Favourite Scenes Set to Non-Score Music, DVD and Blu - ray Cataloguing, Trailers We Got Sick of Seeing, Changing
Ratings Without a Rewatch, Upcoming Terrence Malick Film + Theatre Employees, Niagara Region 2:42:16 — This Week
on DVD and Blu - ray 2:44:10 — Outro
, Blue Valentine NC - 17
Rating Overturned, Prison Inmate Files Lawsuit Over Repetitive Movie Torture 38:35 — Review: Rare Exports: A Christmas Tale 1:17:25 — Trailer Trash: Transformers: Dark of the Moon, Real Steel, Pirates of the Caribbean:
On Stranger Tides, Thor 1:33:30 — Other Stuff We Watched: The Chronicles of Narnia: The Voyage of the Dawn Treader, Top Chef, Vampire's Kiss, The Last Picture Show, The Last Boy Scout, Inception, The Sorcerer's Apprentice, The Complete Metropolis, The Office and Community Christmas Specials 2:18:10 —
Junk Mail: S.O.S. Fantasmi, War Documentaries, Blu - ray vs. DVD Extras, Choosing Which Movies to Upgrade, Blu - ray Becoming Outdated, DC Animated Movies, Frank's Favourite TV Shows and Easy A 3:01:20 — This Week's DVD Releases 3:03:00 — Twitter Poll: What is Your Favourite Non-Traditional Holiday Movie?
, A Good Day to Die Hard
Rated R, Terminator 5 Writers 1:04:10 — Other Stuff We Watched: Seven Psychopaths, Django Unchained, The Watch, Midnight Run, Punch - Drunk Love, Les Miserables, The House I Live In, John Dies at the End, West of Memphis, The Perks of Being a Wallflower, Crime Story, Miami Connection, Looper, The Campaign, No Crossover, Skyfall, Designing 007: 50 Years of Bond Style, The Looking Glass War, Raw Deal 1:52:10 —
Junk Mail: Combined Top 100 Lists, Lack of Animated Movies in Top 100s, The Demise of HMV, Horror Premium Podcasts, This or That 2013 Edition, Director's Cuts, Unrated Editions of Comedies 2:29:35 — This Week
on DVD and Blu - ray 2:31:40 — Outro
The credit
rating on national champion oil producer Petrobras was recently lowered to
junk status, adding to investor worries that Brazil's sovereign debt will suffer the same fate.
NEW YORK, Aug 14 (Reuters)- The global
junk bond default
rate rose to 1.79 percent in July from 1.44 percent in June as U.S. financial and real estate firms struggled to keep up with debt payments, Standard & Poor's said
on Thursday.
For the Washington Mutual Stockholders that day came
on September 15th 2008 when the S&P
rating agency lowered their
rating for Washington Mutual Bank to
Junk status with a negative outlook.
The bubble was a combination of (a) teaser
rates on option ARMs which were like financial time bombs, (b) liar loans in which the rules of good mortgage underwriting (20 % down, 28/36 ratios) went out the window, (C) people at
rating agencies who decided that if one pools enough
junk loans into one bond, it's magically AAA, and (D) Credit default swaps which encouraged these bad loans, and when they collapsed a number of people walked away with billions of dollars.
The U.S. territory also is grappling with $ 70 billion in debt,
ratings firms have downgraded its bonds to one notch above
junk and investors fear it could default
on its obligations.
When risk - free and AAA -
rated corporate bonds yield less than 4 %, 3.5 % yield
on utilities and 6 % yields from
junk ETFs are difficult to pass up.
Similarly,
on the S&P credit
ratings scale, borrowers with
ratings under triple - B are considered «
junk» while only those that fall between triple - B and triple - A
on the scale are considered OK.
The following table includes certain tax information for all Target Maturity Date
Junk Bond ETFs listed
on U.S. exchanges that are currently tracked by ETF Database, including applicable short - term and long - term capital gains
rates and the tax form
on which gains or losses in each ETF will be reported.
This page provides ETFdb
Ratings for all Target Maturity Date
Junk Bond ETFs that are listed
on U.S. exchanges and tracked by ETF Database.
The recent
ratings downgrades by both Moody's and S&P Global Ratings have placed the State of Illinois general obligation bonds on the edge of becomin
ratings downgrades by both Moody's and S&P Global
Ratings have placed the State of Illinois general obligation bonds on the edge of becomin
Ratings have placed the State of Illinois general obligation bonds
on the edge of becoming
junk.
NEW YORK, Nov 7 (Reuters)- Moody's Investors Service
on Friday cut its
ratings on MBIA Inc's (MBI.N) insurance arm and also sent
ratings on the holding company's debt into
junk territory, citing diminished business prospects and a weaker financial profile.
But quantitative easing has also had an effect in suppressing risk premiums in securities that have much less dependence
on the course of short - term
rates — particularly
junk rated debt, corporate debt, and stocks.
This is much worse than
junk bonds, since the default
rate on those even at the height of credit crisis never reached 20 %.
All good & proper, but perhaps a little pointless in the end, as I still think the discount
rate has to begin moving down (& increase valuations)-- I mean, consider the
rate vs. the
rates on Treasuries,
junk, etc., and the fact the discount
rate has to converge
on zero as LE hds twds zero also.
Triple - C
rated bonds, the lowest
junk tier, sold at 42.6 cents
on the dollar at the beginning of last year.
I'm clipping coupons in the short run, running credit risk while I don't see any major credit risks
on the horizon aside from weak sovereigns (think the PIIGS), student loans, and weak
junk (
ratings starting with a «C»).