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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: kris b who wrote (59948)	4/30/2006 9:46:14 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

speculation is creating its own liquidity against inflating assets.> There may be some holes developing in this as well. For instance there was a record issuance of non investment grade corporate bonds in the first quarter, and certainly lots of leverage is used, and those are down 50 basis points since then. Same is true of the assortment of MBS, agencies and ABS securities, they aren't doing so hot either. The cost of levered money measured by Libor or repo rates, has to sting too. At some point in the not too distant future, there will be debt servicing or default trouble with this trash, and the whole Risklove concept will be severely tested. It's a bit like defying gravity.