There are several smaller new deals (or re-openings) in the market today as demand remains quite strong for new issues. DOW brought a deal yesterday and those bonds are already 30-40bps tighter than issue spread.
While I've largely been highlighting the bull case for credit, here are 2 mainstream stories with more of a bearish tone on credit. Reuters has a fairly thin article about a potential pullback in spreads (CNBC's headline for the exact same story says "rally may be over"). Bloomberg has a more substantial article noting the CCC rated bonds are up 80% since March lows and are now overpriced (along with other lower rated bonds).
Please forgive me once again for delving into mortgage land as that is clearly not my area of expertise. However, I suspect we should be a bit concerned by the news that prime borrowers defaulted at a much higher rate than subprime borrowers in Q1.
Perusing the DTCC data on CDS outstanding I noticed 2 interesting data points. Berkshire Hathaway, as an issuer not investor, has 6x more net CDS referencing it than it does public debt outstanding. The largest absolute amount of (net) CDS outstanding is GE with ~$11B; the next closest is BAC with only ~$7B.
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