Salient to Investors:

Gary Cohn at Goldman Sachs said junk-bond yields at record lows may face substantial repricing if interest rates spike or investors exit fixed income. Cohn said that at some point, interest rates will rise and some of the money that has piled into fixed income over the past 3 years will leave.

Martin Senn at Zurich Insurance said markets are signalling progress has been made, and is not concerned about complacency yet because there’s good awareness of the respective risks.

James Gorman at Morgan Stanley said that central banks’ policies of keeping interest rates low are not creating asset bubbles.

Fitch Ratings said last month that declining yields have created a potential for a bond bubble. Howard Marks at Oaktree Capital said the scramble for return has returned elements of pre-crisis behavior.

McKinsey said the 13 largest investment banks are to cut $1.03 trillion in risk-weighted assets. Inventory holdings of corporate bonds by top dealers have dropped 40 percent from 2 years ago and less than a quarter of their 2007 peak.

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