August 5, 2020 | Daily JAM, Mid Term |
In a classic credit crunch, banks and other lenders worried that they might have eased loan standards too much during economic good times, start to tighten lending standards because they are worried that we're in or are heading into rougher times for the economy....
June 8, 2020 | Daily JAM, Volatility, WFC |
On June 2 Wells Fargo (WFC) has announced that it will stop providing loans to a majority of its independent auto dealer customers. Wells Fargo, the largest U.S. mortgage lender, has already cut back on cash-out home mortgage refinancing loans over $250,000 and...
May 12, 2020 | Daily JAM, Morning Briefing |
On March 23, the Federal Reserve announced that it would create a facility to buy corporate bunds and ETFs tracking the corporate bond market. That facility remained an all-talk/no-action vehicle until today when the New York Federal Reserve Bank announced that its...
May 4, 2020 | Daily JAM |
Credit card issuers have already cut the credit limits or closed credit card accounts entirely for about 1 in 4 credit card holders--almost 50 million Americans--in the past 30 days, according to a survey byLending Tree's Compare Cards website. The reductions...
May 2, 2020 | Daily JAM, Friday Trick or Trend |
Our regular (or occasional or perhaps occasionally regular) Friday series (actually running on Saturday this week) Trick or Trend looks at what might (or might not) be emerging investible trends. Exclusively on JAM. This post won't run anywhere else. Ever. It was only...
March 26, 2020 | Daily JAM |
On top of the $2.2 billion that the Coronavirus rescue bill now in front of the House of Representatives allocated to checks to individuals, loans and grants to companies, extra unemployment insurance and more, the bill also gave the Treasury the go ahead to backstop...
March 23, 2020 | Daily JAM |
Today, March 23, the Federal Reserve announced that it would backstop all credit markets in the United States without limits. The Fed said it would purchase Treasuries and mortgage-backed securities “in the amounts needed to support smooth market functioning.” In...
March 20, 2020 | Daily JAM, Morning Briefing, Short Term |
In the credit markets investors and traders are selling everything. Safe. Risky. Doesn't make any difference. And that's creating a potential shortage of dollars. When you sell corporate bonds, you take dollars out of the credit market. When companies draw down credit...
March 16, 2020 | Daily JAM |
Back during the Financial Crisis the Federal Reserve set up a Term Auction Facility (TAF) to make one-month and three-month lending available to any sound bank. The point of the TAF then and the point now is to make sure credit keeps flowing to medium- and...
March 8, 2020 | Daily JAM |
...the stock market to hang on conditions in the credit markets--and not in a good way. While, normally (historical archives do indeed confirm that there once were normal times), falling bond yields push stock valuations higher (lower yields make stock more attractive...
October 2, 2019 | Daily JAM, Volatility |
Those of you who follow along at home know that my big worries now are a further slowdown in the U.S. economy--with a slip into a long cycle of very slow growth--and a credit crunch of the sort described by the late economist Hyman Minsky. Unfortunately, in the kind...
September 13, 2019 | Daily JAM, Mid Term |
Companies sold $13 billion in junk bonds this week, according to Bloomberg. Risk premiums for junk bonds over Treasuries have dropped by 1.5 percentage points in 2019. And at the same time when investors are getting paid less to take on risk, the amount of risk among...
