Well, here’s another situation where we can say the following: “there are only two ways this gap closes.”
Via UBS
Figure 6 highlights that high-yield spreads are tightening rapidly at a time when the usage of collection agencies to collect on unpaid debt continues to grow. When high yield spreads were at similar levels in 2014, the prospect of collection agencies was not even a remote concern.
If high yield debt starts to crater, it’s game over for the economy.
Check’s in the mail.