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Response to Tansy_Gold (Original post)

Fri Nov 22, 2013, 08:58 AM

17. Taper Talk Is Gumming Up The Corporate Bond Market

http://www.businessinsider.com/taper-talk-and-corporate-refinancing-2013-11

The capital market for new issues and refinancing of corporate debt has been on a tear the past few months – I think that ended yesterday. That’s because the dreaded Taper Talk has resurfaced. The Fed minutes yesterday rekindled Fear of Taper.
The Taper On/Taper Off story has been with us for six months now. It started in May with the release of the Fed minutes and the first “whisper’ of the Taper. The talk of the Taper reached a zenith in late September as the debt markets were convinced that Bernanke would start the Taper in October. It was a big surprise to players when Good Ole Ben chose to delay the October start and push it to sometime in the future; and now it’s back.

An interesting consequence of Taper Talk is how it affects the Corporate new issue bond calendar. The following chart shows how talk of taper killed the ReFi market in June/July/October, and it also shows how the window for new issues opened right after Big Ben delayed the taper for a few months. Up until yesterday the corporate finance types and bond dealers on Wall Street were having a daily party. As of today, they will be back to struggling to push deals out the door.



Read more: http://brucekrasting.com/taper-talk-back-going-away-time/#ixzz2lNnAovsG

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