Credit is one of many overvalued markets and the technology sector is particularly risky, according to Richard Bernstein Advisors. “We’re kind of in an everything bubble at the moment,” Mike Contopoulos, the firm’s deputy chief investment officer, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Robert Schiffman in the latest Credit Edge podcast. “Tech is going to come back down to earth a little bit this year,” said Contopoulos. RBA, which invests across asset classes via exchange-traded funds, has no exposure to corporate credit. They also discuss value in collateralized loan obligations, mortgage-backed securities and Europe.

Credit is one of many overvalued markets and the technology sector is particularly risky, according to Richard Bernstein Advisors. &ldquo;We&rsquo;re kind of in an everything bubble at the moment,&rdquo; Mike Contopoulos, the firm&rsquo;s deputy chief investment officer, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Robert Schiffman in the latest Credit Edge podcast. &ldquo;Tech is going to come back down to earth a little bit this year,&rdquo; said Contopoulos. RBA, which invests across asset classes via exchange-traded funds, has no exposure to corporate credit. They also discuss value in collateralized loan obligations, mortgage-backed securities and Europe.

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth research of the most important corporate sectors, trends and themes. Analysis of specific corporate bonds and credit default swaps is backed by Bloomberg Intelligence's robust data sets and indexes.

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth research of the most important corporate sectors, trends and themes. Analysis of specific corporate bonds and credit default swaps is backed by Bloomberg Intelligence's robust data sets and indexes.

The Credit Edge by Bloomberg Intelligence

Inside ‘the Everything Bubble’ With RBA

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BMO Asset Management, which oversees almost C$300 billion ($218 billion), has cut its junk-bond holdings and moved into safer parts of credit as geopolitical and macroeconomic pressures mount. “We love the movie — we’re still there — but we’re just getting a seat closer to the exit,” Earl Davis, the firm’s head of fixed income and money markets, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Spencer Cutter in the latest Credit Edge podcast. “You’re not getting paid to hold as much risk here,” he says. They also discuss why the financial and energy sectors look attractive, how to play hyperscaler bond issuance and opportunities in Canada’s nascent high-yield market, including debt from commodity and defense companies.

 

BMO Asset Management, which oversees almost C$300 billion ($218 billion), has cut its junk-bond holdings and moved into safer parts of credit as geopolitical and macroeconomic pressures mount. &ldquo;We love the movie &mdash; we&rsquo;re still there &mdash; but we&rsquo;re just getting a seat closer to the exit,&rdquo; Earl Davis, the firm&rsquo;s head of fixed income and money markets, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Spencer Cutter in the latest Credit Edge podcast. &ldquo;You&rsquo;re not getting paid to hold as much risk here,&rdquo; he says. They also discuss why the financial and energy sectors look attractive, how to play hyperscaler bond issuance and opportunities in Canada&rsquo;s nascent high-yield market, including debt from commodity and defense companies.
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BMO Slashes Junk Debt Holdings as Geopolitical, Economic Risks Spread

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Companies need to move fast to refinance leveraged-buyout debt coming due over the next few years, according to ICG. “Folks should start getting ahead of it because the traffic jam may be more the issue than anything,” David Saitowitz, the $126 billion global alternative asset manager’s head of US liquid credit, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Mike Holland in the latest Credit Edge podcast. “That could be the kind of risk event that may push the market wider for a period of time,” he says, referring to credit spreads. They also discuss the AI funding bubble, collateralized loan obligation performance and fallen-angel risk.

Companies need to move fast to refinance leveraged-buyout debt coming due over the next few years, according to ICG. &ldquo;Folks should start getting ahead of it because the traffic jam may be more the issue than anything,&rdquo; David Saitowitz, the $126 billion global alternative asset manager&rsquo;s head of US liquid credit, tells Bloomberg News&rsquo; James Crombie and Bloomberg Intelligence&rsquo;s Mike Holland in the latest Credit Edge podcast. &ldquo;That could be the kind of risk event that may push the market wider for a period of time,&rdquo; he says, referring to credit spreads. They also discuss the AI funding bubble, collateralized loan obligation performance and fallen-angel risk.

LBO Debt Coming Due Is Next Big Test for Credit Markets, Says ICG

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Investors are increasingly wary of lenders who dish out so-called bad PIK, or payment-in-kind interest, to help struggling portfolio companies avoid default, according to Anant Kumar, global investment strategist at Benefit Street Partners, the private credit arm of $1.7 trillion asset manager Franklin Templeton. “If you’re a manager who wants to mask stress in the portfolio by doing that, you can probably fool some of the people some of the time,” he tells Bloomberg News’ Sinead Cruise and Bloomberg Intelligence’s Tolu Alamutu in the latest Credit Edge podcast. “I do think investors will catch on if you see a widespread use of PIK in the portfolio without any resolution.” Those managers will likely undershoot expectations when their next fundraising rolls around, Kumar says. The trio also discuss the resilience of private credit illiquidity premia, the specter of inflation and how an industry transparency push is forcing firms to address dubious marks faster than ever before.

Investors are increasingly wary of lenders who dish out so-called bad PIK, or payment-in-kind interest, to help struggling portfolio companies avoid default, according to Anant Kumar, global investment strategist at Benefit Street Partners, the private credit arm of $1.7 trillion asset manager Franklin Templeton. &ldquo;If you&rsquo;re a manager who wants to mask stress in the portfolio by doing that, you can probably fool some of the people some of the time,&rdquo; he tells Bloomberg News&rsquo; Sinead Cruise and Bloomberg Intelligence&rsquo;s Tolu Alamutu in the latest Credit Edge podcast. &ldquo;I do think investors will catch on if you see a widespread use of PIK in the portfolio without any resolution.&rdquo; Those managers will likely undershoot expectations when their next fundraising rolls around, Kumar says. The trio also discuss the resilience of private credit illiquidity premia, the specter of inflation and how an industry transparency push is forcing firms to address dubious marks faster than ever before.

Investors Keeping Score on 'Bad PIK', Benefit Street Partners' Kumar Says

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/e51555ae-b3c8-485e-853f-b49e00ebfa2f/transcript

Inside ‘the Everything Bubble’ With RBA

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