On the wire;
Steve Rodosky, head of Treasury and derivatives trading at Pimco, said that he has stopped buying Treasurys since July. Instead he has purchased high-quality assets in investment-grade corporate bonds, mortgage-backed securities and municipal debt.
Article here: PIMCO Talks Their Book
Bottom line: PIMCO is a buyer of spread product. This helps confirm my thesis that credit still has legs and BABs (or QScABs) have value as well.
Disclosure: Long LQD
This is my effort to help fit the pieces together to get a better picture of the capital markets.
“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”
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