ionbonds

All Aboard

2012-02-03T10:23:00.000-08:00

The Dow Jones Industrial Average nears a 3 1/2 year high while the NASDAQ approaches an 11 year high mark.

Floating Rate Funds are a viable option should interest rates move higher

2012-01-30T07:30:00.000-08:00

Last year, the Federal Reserve Bank hinted that floating-rate notes could be added
to its current stable of debt offerings, which includes T-bills, notes, bonds, and inflation protected
securities (TIPS). An floating-rate note is a debt instrument with a coupon that adjusts periodically
based on changes in the LIBOR rate (London Interbank Offered Rate and the Treasury bill rate). Because the coupon moves up and down with interest rates, these bonds generally have significantly less interest-rate risk for investors than fixed-rate issues with similar maturities. There are several mutual funds that reflect this type of investment, including the Fidelity Floating Rate Bond Fund, and the Nuveen Floating Rate Bond Fund.

Federal Reserve Chairman Says Interest Rates to Remain Low

2012-01-25T21:43:00.000-08:00

Earlier today, Federal Reserve Chairman Ben Bernanke said the Fed does not plan to increase interest rates until late 2014. The Fed previously said it did not expect to raise rates until mid-2013. Maintaining low interest rates is particularly good news for traditionally high yield stocks such as MLPs and agency mortgage REITs.

Moody's delivers higher rating to FedEx

2012-01-16T19:30:00.000-08:00

To start the new year, Moody's Investors Service lifted its credit rating on FedEx Corp one notch further into investment grade, noting the shipping company's strong franchise in the express services market and growth in its ground shipping services segment.

Interest rates are in the "i" of the beholder

2011-10-25T17:23:00.000-07:00

If the Treasury fails to regain its AAA status, U.S. interest rates may rise. On the eve of the downgrade, the countries with AA+ ratings from S&P paid an average of 2.72% on their two-year bonds and 4.58% on their 10-year debt, compared with 1.12% and 2.65%, respectively, for the world’s remaining AAA borrowers.
But averages can be deceiving. Switzerland, which S&P rates AAA, pays just 0.06% in annual interest on its two-year bonds, and the United Kingdom, also AAA rated, pays fully 10 times as much - still a very low rate. And then you get to Japan, which S&P rates two steps lower at AA - a full step below where the United States is now - and pays only 0.15% on its two-year debt. That’s right: this lowly AA-rated country pays less than a quarter of what AAA-rated Britain offers, while interest rates for most other AAA nations are nine times as high as what investors are happy to get from Tokyo.

A Look at Today's High Grade Corporate Offerings

2011-10-13T00:33:00.000-07:00

Company Term Effective Yield

GENERAL ELECTRIC Jan 2021 Aa2/AA+/ 4.308

GENERAL ELECTRIC May 2016 Aa2/AA+ 3.099

JPMORGAN CHASE Jul 2016 Aa3/A+/AA- 3.293

GENERAL ELECTRIC Feb 2013 Aa2/AA+ 1.219

TORONTO DOM BNK Jul 2016 Aaa/AA-/AA- 2.319

The first month of the the last quarter of 2011 is likely to be a sleeper...at least for the bond market.

2011-10-07T17:27:00.000-07:00

Last month, average yields on triple A rated munis maturing in10 years plunged to historic lows of under 2%. But yields on US Treasuries have risen sharply this week, as stocks have rallied. The yield on 10-year Treasury notes was at 1.89% this week, up from a 65-year low of 1.67%last week.Traders say the rise in Treasury bond yields reflects the rebound in equities and the difficulty for a further drop in yields from such low levels unless economic data weakens further. Stay tuned!

A Challege to Find Yields

2011-09-24T10:40:00.000-07:00

Taxable, seven-day money funds have been yielding less than 0.1% since early May, while jumbo CD rates in the secondary market have ranged from 0.2% on a one-month deposit to little more than 0.4% on a six-month instrument, and to only about a percentage point more than that for locking funds up in a five-year “jumbo.” Yields that low, combined with an underlying inflation rate at a three-year high, mean that corporations and individuals hewing to a strict money market strategy are suffering losses after adjusting for taxes and inflation.

Yields Remain at Anemic Levels

2011-09-16T13:48:00.000-07:00

The benchmark 10-year bond is now yielding 2.07%, which is about 3/4 of a percent lower than it was a year ago. The 2-year note is yielding 0.18%, while the 30-year bond is now yielding 3.34%. At the short end of the curve, 3-month T-bills are virtually at 0.00%.

Corporate Bond Market Remains Vibrate

2011-09-15T06:26:00.000-07:00

Money flow into corporate bonds is strong going into the final quarter. So far this year companies have sold $884.8 billion of bonds compared with $770.4 billion during the same period in 2010. Meanwhile, the default rate is just 1.1%. Defaults briefly hit an annualized rate of 9% during the 2008 credit freeze. Another difference is that banks have since built up capital cushions and nonfinancial companies have generally have more than 10% of their assets in cash, the most since 1950s.

Waiting for Godot

2011-09-12T20:14:00.000-07:00

On the equity side....investors are sitting on year-to-date losses and hopes for a fall rally are fading like autumn leaves. The stock market clearly needs a catalyst and that appears as forthcoming as the man in the play Waiting for Godot. Meanwhile, these uncertainties are providing some great values on the fixed income side. I have noticed several short bonds from Ford that are offering reasonable returns.

Swiss banks could be the looking into the future

2011-09-06T06:53:00.001-07:00

Stocks rolled at the open...with Swiss government stepping in to stablize the Franc.....implications are that the recession is not something that is here today and gone tomorrow.

Labor Day is Not a Holiday for the European Financial Markets

2011-09-05T09:00:00.000-07:00

The markets in Europe are setting the tone for another difficult week in the U.S. It has been a rough couple of months in the financial markets that included a feeble attempt by the US government to deal with its debt ceiling, an unprecedented downgrade of U.S. bonds and the pending outcome of the fiscal issues in Europe. Meanwhile, the rising price of gold and the Swiss Franc signals little confidence in finding a path for recovery. Yields on the 10-year bonds (currently below 3%) are lower than the aggregate yield on the stocks of the S&P 500 Index.

Bonds May Not Be the Only Way to Capture Yield

2011-08-14T06:32:00.000-07:00

Last week the Federal Reserve announced that it intends to keep interest rates low to at least 2013. An extended low interest rate environment should benefit REITs. A REIT, or Real Estate Investment Trust, is a company that owns, and usually operates, income-producing real estate such as hotels, apartments, shopping centers, offices and warehouses. Some REITs like the Invesco Real Estate Investment Trust (IVR) also engage in financing real estate.

The Dow's Wild Week

2011-08-12T21:45:00.000-07:00

From the Associated Press

Aug 12, 2011

NEW YORK — The wildest week in Wall Street history ended with a second day of gains.

The Dow Jones industrial average finished Friday with a gain of 125 points. Most other times it would have been a fairly big day. By this week’s standards, it was a sleeper. Friday capped a week when the blue-chip index had four 400-point swings in a row for the first time in its 115-year history.

The Dow dropped 634 points Monday, its sixth-worst point drop ever, as investors responded to Standard & Poor’s withdrawal of the country’s AAA credit rating. It was the first downgrade of U.S. government debt in history. The Dow rose 429 points Tuesday, only to plunge 519 points Wednesday.

Now here are financial news clip from 1987.....

http://www.youtube.com/watch?v=2MyToTwag34

http://www.youtube.com/watch?NR=1&v=XFn1G2goDQw

The Stock Market sheds 5% in Five Hours CDs unchanged

2011-08-05T17:55:00.000-07:00

A sample of CD rates for the week ending Aug 4 : 1-year CD yields. 44% 5-year CD yields1.61%

Market Week Update

2011-08-01T21:51:00.000-07:00

Weak economic numbers and the debt ceiling standoff put steady downward pressure on equities. However, in the face of Tuesday's deadline, Treasuries showed a reassuring resilience, though spreads between short-term and long-term Treasury debt narrowed. Yields on T-bills with durations of six months or less jumped while the 10-year benchmark yield actually fell, suggesting that investors were more confident about the long term than the short term. The uncertainty also dented the dollar and sent gold to yet another record.

Market/Index	2010 Close	Prior Week	As of 7/29	Week Change	YTD Change
DJIA	11577.51	12681.16	12143.24	-4.24%	4.89%
NASDAQ	2652.87	2858.83	2756.38	-3.58%	3.90%
S&P 500	1257.64	1345.02	1292.28	-3.92%	2.75%
Russell 2000	783.65	841.82	797.03	-5.32%	1.71%
Global Dow	2087.44	2154.76	2088.82	-3.06%	.07%
Fed. Funds	.25%	.25%	.25%	0 bps	0 bps
10-year Treasuries	3.30%	2.99%	2.82%	-17 bps	-48 bps

Last Week's Headlines

Down to the wire: After partisan votes in both houses of Congress tried the patience of the country and the world, the weekend seemed to promise light at the end of the tunnel. Though no legislation had been signed or even passed by both houses of Congress, leaders announced that with roughly 48 hours to go before the August 2 deadline for an increase in the Treasury's borrowing authority, they had reached an agreement to submit to their respective members. The agreement would increase the debt ceiling by roughly $2 trillion--enough to get through 2012--and cut roughly $900 billion from discretionary spending over ten years. A new bipartisan congressional committee would have until Thanksgiving to recommend an additional $1.5 trillion in deficit reduction measures. Failure to approve those measures would trigger additional automatic budget cuts in such areas as defense and Medicare provider payments.

Economic growth during the second quarter was a scant 1.3%, according to the initial estimate from the Bureau of Economic Analysis. Even more discouraging was the downward revision to the estimate for Q1. It put the figure at 0.4%--essentially flat, and substantially lower than the earlier 1.9% figure. What growth there was in Q2 was fueled by exports, nonresidential fixed and private inventory investment, and federal spending; higher imports and cuts in state and local government spending acted as a drag.
May brought higher home prices in the 20 cities tracked by the S&P/Case-Shiller index. Prices rose 1% from the month before, though they were down 4.5% from last year. Meanwhile, the Department of Commerce said June new home sales were down 1% from May, though they were up 1.6% from June 2010.
Hurt by fewer orders for cars and planes, durable goods orders fell 2.1% in June, according to the Department of Commerce. It was the second decline in the last three months.

Eye on the Week Ahead

Assuming debt-ceiling legislation can be passed in the hours leading up to midnight Tuesday, investors will watch Treasury auctions scheduled for Wednesday for any signs of weaker demand. Bond rating agencies will be under scrutiny for their assessments of the proposed deficit reduction measures. Once the shouting is over, corporate earnings may have more impact, and Friday's jobs report may once again focus attention on the world outside Washington.

Key dates and data releases: manufacturing, construction spending (8/1); auto sales, personal income/spending, deadline for increase in debt ceiling (8/2); factory orders, U.S. services, Treasury auctions of 3-year, 10-year, and 30-year securities (8/3); unemployment/payrolls (8/5).

What is a Bond

2011-07-29T20:24:00.000-07:00

The following is adapted from “The Complete Money and Investing Guidebook” by Dave Kansas.

Bonds are a form of debt. Bonds are loans, or IOUs, but you serve as the bank. You loan your money to a company, a city, the government – and they promise to pay you back in full, with regular interest payments. A city may sell bonds to raise money to build a bridge, while the federal government issues bonds to finance its spiraling debts.

Nervous investors often flock to the safety of bonds – and the steady stream of income they generate — when the stock market becomes too volatile. Younger investors should carve out a portion of our retirement accounts – 15% or less, depending on one’s age, goals and risk tolerance – to balance out riskier stock-based investments.

That doesn’t mean that all bonds are risk-free – far from it. Some bonds happen to be downright dicey. As with all investments, you’re paid more for buying a riskier security. In the bond world, that risk comes in a few different forms.

The first is the likelihood the bond issuer will make good on its payments. Less credit-worthy issuers will pay a higher yield, or interest rate. That’s why the riskiest issuers offer what’s called high-yield or “junk” bonds. Those at the opposite end of the spectrum, or those with the best histories, are deemed investment-grade bonds.

The safest of the safe are issued by the U.S. government, known as Treasurys; they’re backed by the “full faith and credit” of the U.S. and are deemed virtually risk-free. As such, a Treasury bond will pay a lower yield then a bond issued by a storied company like Johnson & Johnson (investment grade). But J&J will pay less in interest than a bond issued by, say, Shady Joe’s Mail-Order Bride Inc.

How long you hold the bond (or how long you lend your money to the bond issuer) also comes into play. Bonds with longer durations – say a 10-year bond versus a one-year bond – pay higher yields. That’s because you’re being paid for keeping your money tied up for a longer period of time.

Interest rates, however, probably have the single largest impact on bond prices. As interest rates rise, bond prices fall. That’s because when rates climb, new bonds are issued at the higher rate, making existing bonds with lower rates less valuable.

Of course, if you hold onto your bond until maturity, it doesn’t matter how much the price fluctuates. Your interest rate was set when you bought it, and when the term is up, you’ll receive the face value (the money you initially invested) of the bond back — so long as the issuer doesn’t blow up. But if you need to sell your bond on the secondary market – before it matures – you could get less than your original investment back.

Up until now, we’ve talked about individual bonds. Mutual funds that invest in bonds, or bond funds, are a bit different: Bond funds do not have a maturity date (like individual bonds), so the amount you invested will fluctuate as will the interest payments it throws off.

Then why bother with a bond fund? You need a good hunk of money to build a diversified portfolio of individual bonds. Depending on the type of bond portfolio you’re looking to build, it could require tens of thousands in order to do it right. Bond funds, meanwhile, provide instant diversification. We explain more on the differences between bonds and bond funds below.

Before delving into the world of bonds, you’re going to want to familiarize yourself with the types of bonds available and some of the associated vocabulary.

Treasurys are issued by the U.S. government and are considered the safest bonds on the market. As such, you won’t collect as much in interest as you might elsewhere, but you don’t have to worry about defaults. They’re also used as a benchmark to price all other bonds, such as those issued by companies and municipalities.

Treasurys are available in $1,000 increments and are initially sold via auction, where the price of the bond and how much interest it pays out is determined. You can bid directly throughTreasuryDirect.gov (with no fees) or through your bank or broker. They also trade like any regular security on the open market. Treasury Bills, or T-bills, are a short-term investment sold in terms ranging from a few days to 26 weeks. They’re sold at a discount to their face value ($1,000), but, when T-bills mature, you redeem the full face value. You pocket the difference between the amount you paid and the face value, which is the interest you earned. Treasury Notes are issued in terms of two, five and 10 years and in increments of $1,000. Mortgage rates are priced off of the 10-year note (more commonly called the 10-year bond even though it’s technically a note).

Treasury Bonds are issued in terms of 30 years. They pay interest every six months until they mature.

Treasury Inflation-Protected Securities (TIPS) are used to protect your portfolio against inflation. TIPS’ usually pay a lower interest rate than other Treasurys, but their principal and interest payments, paid every six months, adjust with inflation as measured by the Consumer Price Index. It’s best to hold these in a tax-deferred account, like an individual retirement account, or IRA, because you’ll have to pay federal taxes on the increase in the underlying principal – even though you don’t get the principal back until maturity. When TIPS do mature, investors receive either the adjusted principal or the original principal, whichever is greater. TIPS are sold with five, 10, and 20-year terms.

Savings Bonds are probably some of the most boring gifts out there, but it can’t hurt to understand how they work. You can redeem your savings bonds after a year of holding them, up to 30 years. They’re currently offered in two flavors, both issued by the U.S. Treasury:

EE Savings Bonds earn a fixed-rate of interest (currently 3.4%) and can be redeemed after a year (though you lose 3 months interest if you hold them less than five years), but can be held for up to 30 years. When you redeem the bond, you’ll collect the interest accrued plus the amount you paid for the bond. They can be purchased in the form of a paper certificate at a bank for half of their face value (for example, a $100 bond can be purchased for $50) in varying increments from $50 to $10,000. If they’re purchased online, they’re purchased at face value, but can be bought for any amount starting at $25.

I Savings Bonds are similar to EE savings bonds, except that they’re indexed for inflation every six months. These are always sold at face value, regardless of whether you buy paper bond certificates or you buy them electronically.

Agency bonds are not quite as safe as Treasurys, but yet it’s often safer than the most pristine corporate bonds. They’re issued by government-sponsored enterprises. Because these companies are chartered and regulated in part by the government, the bonds they issue are perceived to be safer than corporate bonds. They are not, however, backed by the “full faith and credit” of the U.S. government like Treasurys, which would make them virtually risk-free.

Municipal bonds, or Munis, as they’re commonly known, are issued by states, cities and local governments to fund various projects. Municipals aren’t subject to federal taxes, and if you live where the bonds are issued, they may also be exempt from state taxes. Some municipal bonds are more credit-worthy than others, though some munis are insured. If the issuer defaults, the insurance company will have to cover the tab.

Corporate bonds are bonds issued by companies. Corporate debt can range from extremely safe to super risky.

Coupon is another word for the interest rate paid by a bond. For instance, a $1,000 bond with a 6% coupon will pay $60 a year. The word coupon is used because some bonds really had a paper coupon attached to them, which could be redeemed for the payment.

Par is also known as the face value of a bond, this is the amount a bondholder receives when the bond matures. If interest rates rise higher than the bond’s rate, the bond will trade at a discount, or below par; if rates fall below the bond’s rate, it will trade at a premium, or above par.

Duration is a measure of a bond price’s sensitivity to a change in interest rates, measured in years. Bonds with longer durations are more sensitive to interest rate changes. If you’re in a bond with a duration of 10 years and rates rise 1%, you’ll see a 10% decline in the bond’s price.

Steady Sailors for Coupon Clippers

2011-07-28T11:07:00.001-07:00

Mead Johnson Nutrition reports strong earnings, which sent the stock higher by 6%. Meanwhile, MJNs bonds (Baa1) for 2019 are yielding nearly 4%

Morgan Stanley sells $2 billion of bonds….Some of the 10-year notes were @ 5.5% or about 2.5% more than similar-maturity U.S. Treasuries,

Goldman Sachs sells $2.75 billion of bonds w/ a yield of 2% > similar-maturity Treasuries. During July 2010, GS issued $500 M of 10yr notes with a coupon of 5.2%

Seagate Tech shares drop most in 2yrs after Q1 profit missed analysts’ estimates. The co's 2016 bonds yield > 5%.

Last month S&P downgrades Legg Mason credit ratings. The ratings agency said LMs outflows had not slowed in 2011 Currently LMs 2015s yield 3%

Wall Street analysts recently upgraded Emerson Electric. Currently the stock trades 10% off its 52wk high. EMR's 2018 bonds sport a 3% yield.

Highlights of Bill Gross's recent Morningstar Speech

2011-07-17T11:08:00.000-07:00

Bill Gross, manager of the world's largest bond fund (PIMCO Total Return Fund), delivered the opening keynote address to the 2011 Morningstar Investment Conference in Chicago. He spoke on a wide range of topics, including the outlook for treasury bonds and whether the Federal Reserve will pursue a third round of quantitative easing. Here are four takeaways from his speech:

Avoid treasuries With real interest rates yields (after factoring in the current inflation rate) at negative levels, investors risk seeing returns on treasuries being driven lower. Gross made it clear that he did not foresee a huge sell-off or a "debacle" in the treasury market, because countries like China will continue to buy treasuries. But he reiterated that PIMCO's flagship fund, PIMCO Total Return, owns no treasuries, even as that asset class continues to rally.

Look outside the United States U.S. government debt only makes up about half of the entire bond market, Gross said. He mentioned a handful of other countries outside the United States that offer more attractive yields, including a combination of emerging and developed nations like Brazil and Canada. He acknowledged that more risk comes with investing in other countries.

There will be no more bond-buying programs. Gross believes the Federal Reserve will not initiate a third round of quantitative easing (QE3). He thinks the Fed will keep repeating the "extended period" language it has used since March 2009. The Fed has repeated in every statement since then that it plans keeping interest rates at virtually zero, where they have been since December 2008, for "an extended period."

Buy dividend-paying stocks While acknowledging that it was odd for a bond-fund manager to recommend buying stocks, Gross told the audience that many large, multinational U.S. companies offer attractive yields, especially while bond yields stay near record lows.

2011 Half-Time part III

2011-07-13T08:04:00.000-07:00

Bond Market Update

Interest rates could begin to move up late this year

For the last several years, comments from some of the most highly touted money managers suggest that interest rates are destine to move higher…..at least if there is ever evidence that the US economy will begin to accelerate. For that reason, we continue to purchase on short-term fixed income securities - generally those that mature within less than six years.

At Solomon Asset Management, our conservative portfolios have a two-fold approach to managing our client accounts….Decrease risk and Generate income.

Our goal is to benefit from rising yields while avoiding the substantial risk that would accompany a sharp rise in longer-dated issues. The Federal Reserve is likely to try to keep interests rates low until labor demand is sufficient for them to consider the recovery self-sustaining. Moreover, isn’t next year an election year?

The Federal Reserve may also consider addition support to prop up the U.S. economy with more easy money for institutions. This program is Quantitative Easing (QE1 & QE2) or The Big Easy. However, when our government eventually exits its economic support plan there may be some additional inflation. The rebuilding efforts in Japan could also fuel inflation later this year.

The US Debt Situation is Hardly Talk of Shooting Stars from a Rainbow

2011-07-11T07:57:00.000-07:00

Last week on CNBC Rick Santelli discussed the debt limit and what may happen when it is reached sometime in early August. Rick became passionate about his position that there should be no compromise on increasing the limit and that the government absolutely has to solve this issue by cutting spending.

Reaching the debt limit in August means that the government will run out of cash reserves and will need to depend only on the cash it brings in day by day. For the month of August, cash receipts will be about $203 billion and expenses will be around $362 billion. If the debt limit is not increased, the Treasury Secretary will prioritize the list of creditors and determine who does and is not paid. Almost $159 billion will not be paid in August.

As the economy continues to muddle through a weak recovery….housing prices continue to fall, about a quarter of all mortgages are under water and unemployment remains about 9%...if the US government is unable to pay its bills interests rates will likely begin to move higher and higher.

Standard & Poors has already placed the United States on negative credit watch. They do that before they downgrade the credit rating. If US has unpaid bills creditors will want higher rates on whatever money they may loan…it is that simple. If the interest rates on US Treasury bonds go up, mortgage rates and interest rates paid by corporations go up too. If houses are not selling in a 4.5% mortgage rate environment, how many folks will be eager to borrow at 6.5%? How many employers will want to add employees?

2011 Half-Time Report part ll

2011-07-09T18:00:00.000-07:00

Stock Market Update

Dividends, interest income and capital preservation continue to be the primary focus of our client portfolios.

There is no doubt that the US economic recovery is in a soft patch and the stock market has accordingly been struggling in a trendless pattern since January. Should future economic data remain anemic, the stock market could be in for a sloppy summer.

No one has the key to the market, but the best lock-picking tools are telling us that any further weakness is unlikely to be another The Big One that investors experienced during 2008.

For the time being, I feel that our investments are best served by having a focus on dividends and income. Meanwhile, lagging indicators such as the employment numbers remain weak. Furthermore, the real estate market is platonic as lending and borrowing activities continue to be absent. The emerging world recovery has slowed, which resulted in a pullback in commodity prices. It also appears that energy prices and the weak U.S. dollar may have found a floor….as have bond yields.

Similar to the beginning of the year, we are remaining cautiously optimistic as we start the second half of 2011. Moreover, because the stock market can quickly change its direction, especially when investor sentiment becomes excessively bullish, we are sticking with balanced asset allocation model for most of our investment portfolios. Below are a few of the near-term considerations for related to the stock market.

While the major equity indices pushed to higher highs during the first quarter, the number of stocks recently posting new highs has lagged; this loss of momentum is a negative indicator.
The most optimistic forecasts for the US economy project growth to only be 3% in 2011 and 2012.
At some point, interest rates are likely to start rising.
The devastation caused by the earthquake and tsunami in Japan weakened the world’s third largest economy and its trading partners, including the U.S.

Meanwhile, corporate profits remain strong and the majority of balance sheets are in good condition. Additionally, many corporations are in excellent condition to increase dividends and initiate stock buybacks.

2011 Half-Time Report

2011-07-08T04:36:00.000-07:00

A roller coaster analogy is often used to describe investor experiences in recent years. In some ways, the comparison is perfect and obvious. The stock market’s scary 2008 dive was followed by a dramatic rise in 2009. During 2010, the stock market experienced several up and down periods before finishing the year with modest gains. Meanwhile, since 2008, the bond market has experienced a slow and steady rise that was fueled by sliding interest rates.

During the first half of this year, the stock market has been dealt several challenges: these include a tragic earthquake in Japan, rising oil prices, geopolitical strife (once again) and Europe has not shaken the Greek flu. Furthermore, there is a strong possibility that the Federal Reserve's money-printing machine will be unplugged. The stock market’s technical indicators are also flagging, as the number of new 52-week highs appears to be sliding. From a fundamental standpoint, corporate-profits are also facing headwinds because costs have been completely squeezed out of their businesses. Regardless, it is not likely that a stock market correction will be as dramatic as the retreat that occurred in 2008.

As we enter second half of 2011, the U.S. economic recovery appears to be slowing. In addition to a possible jolt from higher commodity prices, job creation remains disappointing and the housing price recovery still appears a few years away. Around the globe, Europeans attempt to avert yet another banking crisis. In addition to the debt problems in Greece, Spain, Portugal and Ireland remain fiscally challenged. Any potential of a near-term rebound in Japan will be later this year and the big growth stories of China and Brazil are poised to re-start.

Eastman Kodak Bonds, Credit Swaps Reeling On Patent Dispute ....from WSJ

2011-07-02T17:14:00.000-07:00

NEW YORK (Dow Jones)--The price of Eastman Kodak Co. bonds fell Friday, and the cost of protecting its debt against default rose after the U.S. International Trade Commission said it would reconsider certain key findings in the company's patent dispute with Apple Inc. and Research In Motion Ltd.

Eastman Kodak's 10.625% bonds due March 2019 fell to 94 cents on the dollar from 98 cents as of Thursday; its 7.25% bonds due 2013 fell to 90.5 cents from 96.3 cents; and its 9.75% bonds due 2018 fell to 91.5 cents from 95 cents, according to data provider Markit.

Similarly, credit default swaps on the debt became more expensive, quoted at 31 points upfront from 29.36 points Thursday, said Markit. That is equivalent to a rise of $164,000 upfront in the cost of covering $10 million of the bonds against non-payment over five years, on top of $125,000 in regular quarterly payments.

The Commission issued a federal regulation notice Thursday, determining to "affirm in part, reverse in part, and remand in part, the final initial determination issued by the presiding administrative law judge on January 24." That notice delays Eastman Kodak's patent infringement case against Apple and Research In Motion, claiming that cameras on cellphones and other wireless devices use a Kodak-invented method of previewing images without permission.

The Commission extended the target date for its final ruling until Aug. 30.

"We remain extremely confident this case will ultimately conclude in Kodak's favor," the company's general counsel and chief intellectual property officer, Laura G. Quatela, said in a statement.

Business Week Article Discusses Spanning the Globe for Bond Yields

2011-06-24T07:48:00.001-07:00

http://www.businessweek.com/investor/content/jun2011/pi20110623_808293.htm?campaign_id=yhoo

Best Buy is going on a diet.

2011-06-23T08:32:00.000-07:00

Weak sales & online competition have the co looking to downsize. BB is launching plans to wall off parts of its cavernous stores and sublease the space to smaller retailers. Stk, now in the low 30's has been weak in 2011. However, the company's Bnds look healthy w/ YTMs @ 1.8% for ‘13s & 3.25% for ‘16

POP POP FIZ FIZ...FedEx Earnings Pop Short Lived in Stock Market

2011-06-22T13:48:00.000-07:00

Earlier today, FedEx reprt results topped analysts‘est FDX stk is up 2.2% to $91 The co's corp bnds incld '14 w/YTM 1.4% & '19 w/YTM 3.75% For more on the fixed income bond prices and yields check @ionbonds on Twitter.

Stock Market Rally is led by the Tech Sector

2011-06-21T10:50:00.000-07:00

Today’s stk market action is led by the tech sector – higher by nearly 2%. Several short term tech bnds standout such as the Seagate ’16 w/a YTM > 5%

Excerpts from @ionbonds Twitter

2011-06-21T00:13:00.000-07:00

ionbonds

At the stk mkt open EK gained 3%. The stk is also higher nearly10% this month. This bodes well for the co's 2013 offering @ 94 w/YTM >10%

16 hours ago Favorite Reply Delete

ionbonds

Kroger has a bond avail that comes due in Jan 2013 yielding 1.4%. The company just reported earnings that exceeded analysts expectations.

16 Jun Favorite Reply Delete

ionbonds Greg Solomon

For its quarter ended May 21, Kroger said product cost inflation rose 3.5% vs a year-earlier period.

16 Jun Favorite Reply Delete

ionbonds

Treasury prices gained today as short term yields fell to the lowest levels on record...the 10yr note now yields 2.9% Read on to next Tweet

16 Jun Favorite Reply Delete

ionbonds

THAT's RIGHT buy a $100,000 10yr US Gov bond and you receive $2,900 a year...just a bip over $200 a month.

16 Jun Favorite Reply Delete

ionbonds

Standard & Poor’s raised corporate credit rating for casino operator Las Vegas Sands citing strong growth prospects.http://t.co/uQr8geZ

16 Jun Favorite Reply Delete

ionbonds

Corp fixed inc listings incl GE ’14 @ 1.75% KFT ’20 @ 3.9 No interest here investors wait to get their dance card punched for Pandoras IPO

15 Jun Favorite Reply Delete

ionbonds

JC Penney hires Apple exec. & stock rises. Meanwhile B rated 2015 bonds have a yield that is better than 4% http://t.co/foNaTim

14 Jun Favorite Reply Delete

ionbonds

10yr Treasuries prces fall w/yield @ 3.01% as data showed Chinese economy stonger reducing demand for the safety of U.S. fixed-income assets

14 Jun Favorite Reply Delete

ionbonds

Among last week’s active corps include Boston Scientific '17 w/ 3.8% yield and a juicy 4yr from Ford yielding 4.5% The 10yr Treasury: 3%

13 Jun Favorite Reply Delete

ionbonds

Good Morning Bond buyers as the stock market opens in front of the backdrop of a green board painted by mergers, PFEs 2015 yields 1%

13 Jun Favorite Reply Delete

ionbonds

The lastest CD yields from Wells Fargo look awfully tempting 24 months 0.55% months & for 36 months (That's THREE YEARS) 1.05%.

12 Jun Favorite Reply Delete

ionbonds

The bond market is closed today....but be sure to check back tomorrow for an update on the roaring action.

12 Jun Favorite Reply Delete

ionbonds

Check @ionbonds for regular updates on corporate bonds, including yields, availability, ratings and news.

11 Jun Reply Delete