No Systemic Risk

Posted on Dec 15 2015 - 1:36pm by Dan

There has been a lot of talk lately regarding high-yield instruments, given the ‘Third Avenue‘ announcement that they were instituting a gate to restrict withdrawals from it’s high-yield fund.  Other notable investors have been discussing the problems with High-Yield.  We ourselves wrote of the problems facing High-Yield in 2014.

I know I spoke of this somewhat in yesterday’s entry, but allow me this time to be very clear on one specific point …

I see nothing … at the present time … that indicates there is systemic financial risk arising from the current problems in High-Yield

Yes, something more serious could develop from current initial conditions, as we progress into the the future.

But I monitor a number of market relationships, meant to detect such systemic financial risk.  And I’m telling you … not only is this event not showing up as a blip on the radar?

Those relationships are improving ...

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