1 December 2018 FT — Articles to Read

1 December 2018


Question: According to MSN: Lifestyle, what are the top 10 causes of death in American (#’s based on 2017)?


Credit markets set for worst year since 208 as investors shed corporate debt – Pg. 1

–          Investors pulled more than $5bn from funds investing in corporate bonds in the past week, as the credit market heads for its worst year since the financial crisis a decade ago and concerns mount over the outlook for 2019

–          Rising US interest rates, the Federal Reserve shrinking its balance sheet and the ECB ending its bond-buying programme have stirred worries over a new era of “quantitative tightening” that might rattle financial markets

–          Corporate debt has emerged as one of the focal concerns…

–          US corporate bond yields have been climbing steadily this year, to an eight-year high of 4.36% on Thursday.  That has inflicted a 3.9% loss on investors so far in 2018, putting it on track for the worst year since 2008

–          Corporate debt as a percentage of US GDP is at a record high…


Fed considers adjustment to keep interest rates on track – Pg. 4

–          The US Federal Reserve is preparing the ground for a further tweak to interest rates to ensure it keeps borrowing costs exactly where it wants them – with the change potentially set to happen before its next formal policy meeting

–          …considering a “technical adjustment” to one of the rates that the central bank uses to ensure the federal funds rate remains well within the target range it wants, currently 2% to 2.25%

–          The potential change to interest on excess reserves or IOER, would follow a move the Fed made back in June, when it raised it by 20bps, rather than the normal 25bps

–          An alternative would be to go back to a system similar to the pre-crisis one, in which a relatively scarce quantity of reserves is held by the banks and the central bank conducts frequent interventions to hold official rates close to its target


Treasuries catch little relief despite dovish Fed – Pg. 11

–          Federal Reserve Chairman Jay Powell’s more dovish stance helped buoy stocks this week and briefly tipped the 10-year US Treasury yield below the 3% mark for the first time since mid-September

–          One of the most notable aspects of the “Red October” sell-off that has continued to echo and fray nerves in November is the lack of a strong rally in Treasuries, the traditional haven asset for investors

–          Despite US equities erasing the last of their 2018 gains, the 10-year Treasury yield – the most widely watched interest rate in the global economy – has only grudgingly dipped lower

–          The Fed is still widely expected to lift interest rates again later in December…


Answer: (1) Suicide (47,173); (2) Kidney disease (60,633); (3) Influenza and Pneumonia (55,672); (4) Diabetes (83,564); (5) Alzheimer’s Disease (121,404); (6) Stroke (146,383); (7) Chronic Lower Respiratory Diseases (160,201); (8) Accidents/Unintentional Injuries (169,936); (9) Cancer (599,108); (10) Heart Disease (647,457)