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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: russwinter who wrote (24984)1/20/2005 7:03:29 AM
From: crustyoldprospector  Read Replies (1) of 110194
 
Russ, spreads may be widening because GM paper is about to get a junk rating, or so says Lance Lewis (posted with standing permission):

"Corporate spreads are probably worth keeping an eye on over the next few weeks as GM debt spreads continue to widen due to the growing possibility of it being downgraded to junk status. With about $400 bil in debt, I have to think the junk bond market (which is already at historically frothy levels) would have trouble absorbing something of that size without a serious widening of general credit spreads."

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