Business

On June 29, 2006, the Fed did something it would not do again for (at least) nine and a half years: it hiked rates by 25 basis points, its 17th consecutive rate hike. Everyone knows what happened after.

On December 16, 2015, the Fed is expected to do something it hasn't done for 3,457 days: hike rates by 25 bps, ending the longest period in US history (84 months) of zero interest rates.

How has the world changed in the interim? Some quick observations from BofA:

Now that everyone is finally looking at junk bonds with hopes to buy, sell or short as one's inclination may be, everyone is realizing something we have been warning about since 2012: when times of stress emerge, either the Bid/Ask spread is gargantuan (good luck with those "subject" quotes from dealers who have no inventory), or there is simply no market as the first hint of a buyer or seller make bond traders the carbon-based equivalent of an HFT algo, and pull their quotes. In short: there is no liquidity.

Earlier this morning we got another glimpse of reality behind the smoke-and-mirrors, mainstream-media-sponsored last-pillar-standing lovefest that is US auto sales when the business sales data showed a disheartening tumble in sales in October. So where are all the sales going that automakers report? The answer is simple... (and painful).

Submitted by John Rubino via DollarCollapse.com,

Here’s one for the "actions speak louder than words" file:

Massive insider selling spurs stock market concerns

 

(CNBC) – Corporate insiders have been selling their shares at near-record levels, and according to some, this could be a sign for outside investors to start selling as well.

 

With the biggest single-day drop in over 4 years, US High-Yield bond prices have collapsed to their lowest levels since July 2009. Crucially, it's not just energy companies as the painful illqiuidty has careened across the entire space, not helped by fund liquidations and the biggest outflows since August 2014.

As we warned here, and confirmed here, something has blown-up in high-yield...

With the biggest discount to NAV since 2011...