(04-09-2020, 05:21 PM)Otter Wrote: Also, perhaps the Fed using newly printed dollars to prop up a high risk lending pool that was first created in the 1970s isn't a smart move. I get modern monetary theory, I get the need to expand the money supply and velocity of money during a potentially deflationary cycle, I get propping up sovereign debt, munis, and even investment-grade corporate notes so that credit markets don't lock up completely and start the death spiral.
But propping up the corporate equivalent of the loan-sharking industry. Wow. Just wow.
Risk is meaningless. Everyone should just mortgage their homes and buy HYG for a federally guaranteed 5%+ return. Better get yours now before others do and drive down the yield.
This is going to get interesting. One of the funds I posted (HYT) is a Blackrock loan shark ETF. I wasn't complaining when I was up 30% plus a dividend over 10%. A decent fund when you buy it very low. You can eat some bad debt. Now it gets rescued? This is why the political fights happen. Privatized gains and socialized losses.