Parts of the US corporate bond market are starting to look increasingly risky, and “people are going to be carried out on stretchers.”
That was the fantastic quote in the Financial Times on Sunday from Laird Landmann at TCW, a major asset management firm. According to the report, Landmann added: “when earnings are coming down, leverage is high and interest rates are going up. It’s not good.”
Landmann isn’t the only one voicing concerns about the market ahead of the Federal Reserve’s December meeting on December 16.
The Fed seems likely to finally hike interest rates after 7 years at practically zero. Though the climb in rates will likely be slow, and the US central bank has given more warning than ever before, there are concerns about how well the market can handle even a small amount of tightening.
