"When you combine ignorance and leverage, you get some pretty interesting results." - Warren Buffett
- Source Exane BNP Paribas
- If this trend continues, US Investment Grade credit will become less and less attractive from current levels of rates/spreads
- This might be a statement of the obvious but, this "releveraging" to finance buybacks/acquisitions is a "bullish" development from a "volatility" perspective at medium/long term. The correlation between credit spreads/equities is more likely to rise and "self-power" financial stress in a case of a "Macro" risk reversal.
"Fair play doesn't pertain in bargaining. What matters there is leverage." - Alan Rosenberg, American actor