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Strategies & Market Trends : US Inflation and What To Do About It -- Ignore unavailable to you. Want to Upgrade?

To: John Vosilla who wrote (1135)	10/2/2019 7:42:59 PM
From: RetiredNow	Read Replies (1) \| Respond to of 1504

The guy I listen to in order to understand corporate debt is Jeffrey Gundlach. He says that if normal standards are used by the ratings agencies to rate corporate debt, most of it would be re-rated to junk. So he says there is a ton of corporate debt that will become fallen angel debt, meaning it will lose investment grade status, which will trigger a multiplier effect as mutual funds and ETFs are forced to sell it when a re-rating occurs. He says that it's only a matter of time until this cascade hits. So that will tank the corporate bond market, which is why I hold no corporate debt and only hold short dated Treasuries. In addition, this will turn the spigots off, so zombie corps can't borrow more, which means their stocks will tank as they face cash flow problems and become going concern issues. That will also create a cascade effect. So we're likely to see a period of stocks AND bonds going down in tandem during the next recession. It will be ugly and will catch most people off guard. Holders of cash and Treasuries will do great. Maybe holders of gold and silver will do ok, but I don't invest in those, because JPMC and other big banks, as well as the Fed manipulate gold and silver, which makes it a highly speculative gamble. The name of the game for the next year until the election is to NOT LOSE MONEY. Forget about returns over the next 12 months. Just focus on not losing money.