Calm Before The Storm: Junk Bond Spreads Are Ridiculously Low

My argument is that, in central bank-manipulated environments like we’ve had for several decades, very low high-yield bond spreads indicate the formation of a dangerous economic bubble. The high-yield spread was unusually low during the late-1990s Dot-com bubble and mid-2000s housing bubble, as well as during the current “Everything Bubble” that I have been warning about.

 

 

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