A Mini Credit Crunch?
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According to FOX Business Network’s Charles Gasparino citing unnamed sources on Wall Street, the economy is seeing a mini credit crunch which could have far-reaching impacts on U.S. corporations if extended.
"From what I'm hearing, senior execs at corporations – credit analysts- is that its related to the European debt problems and the fact you have major amounts of debts being held by U.S. banks and investors and they’re taking major losses,” Gasparino said. "Major declines in U.S. corporate issuance."
He added that this situation is not like the events of 2008 when corporation could not sell their debt, but did note that there has been a massive drop off in U.S. corporate issues.
Gasparino revealed that corporate issues fell from $127.5 billion on March to $48.5 in May, with the number of issues dropping from 241 to 132 in the two month period.
"It makes you think we are headed for some real problems in the bond market,” he added. “This could reverse itself and it could be momentary jitters."
He sees it as a necessity to put money into the stock markets right now, as long as the interest rates stay low.
"We can't get deals done," Gasparino said, paraphrasing his unnamed source. "We are experiencing a mini credit crunch."
"From what I'm hearing, senior execs at corporations – credit analysts- is that its related to the European debt problems and the fact you have major amounts of debts being held by U.S. banks and investors and they’re taking major losses,” Gasparino said. "Major declines in U.S. corporate issuance."
He added that this situation is not like the events of 2008 when corporation could not sell their debt, but did note that there has been a massive drop off in U.S. corporate issues.
Gasparino revealed that corporate issues fell from $127.5 billion on March to $48.5 in May, with the number of issues dropping from 241 to 132 in the two month period.
"It makes you think we are headed for some real problems in the bond market,” he added. “This could reverse itself and it could be momentary jitters."
He sees it as a necessity to put money into the stock markets right now, as long as the interest rates stay low.
"We can't get deals done," Gasparino said, paraphrasing his unnamed source. "We are experiencing a mini credit crunch."
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