We’ve talked a lot about this being a Jenga economy and anything. The economy is now so fragile because of all of the Fed money printing and the global central bank money printing that any little piece that comes out could topple the whole thing. And we’re coming up to a place where we’ve got a major thing that’s about to happen. I’m going to take you down this rabbit hole that is intentionally made so complex, and I’ll try and simplify it for you. But this is really important!

CHAPTERS:

0:00 Introduction

1:24 LIBOR & SOFR

2:43 Derivatives

6:02 Integration in Financial System

13:55 Libor Act

25:33 Fed Rate Hike

29:18 G7 on Standby

SOURCES:

https://www.sciencedirect.com/science/article/abs/pii/S0304405X22000976

https://www.theleadleft.com/leveraged-loan-insight-analysis-4-11-2022/

https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/surging-demand-for-leveraged-loans-propels-dividend-payouts-to-record-pace-66753630

https://www.moodys.com/research/Moodys-Weaker-covenants-in-recent-leveraged-loans-to-allow-for–PBC_1302298?cid=7QFRKQSZE021

https://www.lcdcomps.com/lcd/f/article.html?aid=12491603

https://jsf.pm-research.com/content/28/2/74

https://www.bloomberg.com/news/articles/2022-10-14/ubs-sees-9-leveraged-loan-default-rate-as-fed-fights-inflation?sref=rWFqAg1Y

https://www.bloomberg.com/news/articles/2022-10-07/the-party-s-over-data-show-risks-built-up-in-credit-markets?sref=rWFqAg1Y

https://www.bloomberg.com/news/articles/2022-09-29/more-pain-ahead-for-banks-as-investors-balk-at-risky-lbo-debt?srnd=fixed-income&sref=rWFqAg1Y