Safe Landing

While most Americans were in the midst of Thanksgiving preparations last week, Amazon founder Jeff Bezos was making space history.

In the first successful test flight of a rocket with all reusable parts, the New Shepard booster landed four feet from where it had taken off on the plains of West Texas. Next step: human passengers. “I’m thinking it could be sometime in 2017,” Mr. Bezos said.

This triumph came after earlier industry failures, which had led critics to question private space travel. Similar skepticism surrounds vehicles of a different sort.

As our Chart of the Week highlights, new CLO issuance is sputtering as the year winds down and is predicted to be off next year as well. Wells Fargo’s guru of collateralized loan obligations, David Preston, is calling for $75 billion of new volume for 2016. That compares to about $90 billion so far this year, and $124 billion in 2014 – a record year.

This trend has some in the financial media all but writing off this highly adaptable financing tool. Yet the slowdown is mostly attributable to risk retention rules which take effect in about thirteen months.