Is the Feds going to bail them out now? This is the start… is the T-Bills next?
Credit Card Bond Sales at Zero, First Time Since 1993 (Update1)
Nov. 5 (Bloomberg) — Credit card companies were shut out of the market for bonds backed by customer payments in October for the first time in more than 15 years, as investors shunned the debt amid the global credit freeze.
A weakening job market and a looming recession are making it harder for consumers to make monthly payments, eroding confidence among investors about the safety of credit-card-backed bonds. It’s the first month since April 1993 that there have been no sales, according to Wachovia Corp. data. Issuers sold $17.1 billion of the debt in October 2007, the data show.
“Nobody is eager to put money to work given the uncertainty in the market,” said James Grady, a managing director at Deutsche Bank AG’s asset management unit. “When you think it can’t get worse, it continues to get worse. There is not a demand” for these bonds.
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Click image to view Niall Ferguson discuss the current financial situation with Robert Miller of The Telegraph.
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