Salient to Investors:
Corporate bond sales are $3.9 trillion in 2012 versus $3.29 trillion in 2011 and $3.23 trillion in 2010, and the previous all-time high of $3.89 trillion in 2009. EPFR Global report a record $455.7 billion has flowed into bond funds in 2012.
Corporate bonds returned 11.5 percent in 2012 versus 4.86 percent in 2011 and 20.5 percent in 2009. The yield spread with government debt is at 2.23 percent versus 3.51 at the end of 2011.
Moody’s reports refinancing was a use of proceeds in 63 percent of investment-grade, dollar-denominated offerings in Q3. Anthony Valeri at LPL Financial said this shows that financial markets are functioning well.
The average economist expects the global economy to grow 2.22 percent in 2012 versus 2.9 percent growth in 2011.
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