Junk Bonds on a Roll

One of our readers asked for help deciphering what was going on in the high-yield market. So we recruited Matt Fuller from our content partner, LevFin Insights. “From the perspective of high-yield investors,” Matt told us, “it’s a great time to be involved. We were pretty much shut down in March. Total volume was only […]

Covid-19 and the Labor Market

The Bank of England has projected the COVID-19 pandemic will cause GDP for the UK to decline 14% this year. That’s the worst economic performance in three centuries. In 1706 (when the Bank of England was twelve years old) Great Britain was a very different place: devastated by wars and weather, the union with Scotland […]

Direct Lending....After COVID-19

As we wrap up our COVID series, we turn our attention to the path ahead, as unclear as that is. Or as one economist put it succinctly: “Anyone who thinks we’re going to keep moving up in a straight line is living in La-La Land.” The good news is markets have fully absorbed the shock […]

The Great Stay-In vs the Great Recession: Lessons Learned

“The GFC was a crisis that began on Wall Street and spread to Main Street. COVID-19 is a crisis that began on Main Street and spread to Wall Street.” That’s how one private credit manager compared the two worst downturns since the 1930’s. With the coronavirus still in its early stages, this pandemic might end […]

Covid-19: The Best and the Worst Industries

If you’re watching this broadcast from your home office, you’re not alone. According to one study, 97% of the US population is either at home or sheltering in place. This has completely upended the free-flowing, dynamic nature of the largest, most diversified economy on the planet. -Industries that took decades to develop competitive products and […]

COVID-19 and the Economic Outlook, with Brian Nick (Part II)

This week we wrap up our conversation with Brian Nick, Nuveen’s chief investment strategist: Q1: How do you compare this cycle with the last one (Global Financial Crisis)? Q2: The Fed did jump in pretty quickly to cut rates to zero. Are they out of weapons? Q3: Do PrivateEquity firms have any Federal rescue programs […]

COVID-19 and the Economic Outlook, with Brian Nick (Part I)

As goes COVID-19, so goes the nation.” We rephrase the famous 1950’s dictum on General Motors’ relationship to the national welfare in examining how the coronavirus has hijacked all aspects of the economy. There’s broad consensus that once the disease runs its course, commercial activity will be restored. It’s also agreed that between now and […]

Covid -19 and Direct Lenders

“We did not underwrite for this.” So said the partner of a top-tier middle market private equity firm, speaking of the challenges dealing with the impact to businesses of #COVID-19. “We always model downside scenarios for investments,” told us. “But the zero revenue case wasn’t one of them. This is such a dramatic shift from […]

COVID and Private Equity

On February 12 a columnist Barron’s wrote: “The three main U.S. stock indices closed at record highs as concerns over the coronavirus economic impact seemed to fade…Can anything stop this rally?” That was six weeks ago. The Dow was at 29,551. Today it’s 8,000 points lower, the economy at a standstill, global markets in shambles, […]

COVID-19 and the leveraged loan market

This week we’ve been doing bedchecks on our friends in the #CreditMarkets. We caught up with one long-time practitioner, hanging out in the home office with family in “bathrobes and bunny slippers.” “The capital markets went from price perfection to price combustion,” he told us. “There’s a lot going on behind the scenes, nothing in […]