Capital markets have ballooned: think, for example, of the development of the junk-bond and asset-backed market in the 1980s.
This blog is not about the equity, bond, or property asset markets.
Bit by bit, the standard components of modernity were put into place, including stock, bond and commodity markets, asset management and credit analysis.
Among its best performing funds are the Virtus Multi-Sector Short Term Bond Fund run by Newfleet Asset Management and its Emerging Markets Opportunities Fund run by Vontobel Asset Management.
Fitch notes that existing bond indentures include limited restrictions on asset sales, thus providing little if any protection to bondholders.
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Lower yields mean lower bond-portfolio returns for many asset managers.
In particular, by keeping interest rates too low for too long, the Federal Reserve under Ben Bernanke has underpriced credit and increased risk taking, fueling asset bubbles in the bond and commodity markets.
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"That suggests investors expect the new leaders will try to avoid any bond default, " says Wang Yingfeng, a bond-fund manager at Yaozhi Asset Management Co. in Shanghai, which has two billion yuan in assets under management.
Aside from the problems in the bond markets in general and the asset-backed sector in particular, First Marblehead has had to contend with an investigation into the student-lending industry announced by New York in August and questions about the planned acquisition of Sallie Mae.
Vivendi had given itself some room to take less cash, say credit analysts, thanks to earlier asset disposals and high-yield bond issuance.
David Ranson of Wainwright Economics, a consultancy, has examined how gold and corporate-bond spreads have worked as a guide to asset allocation since 1978.
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The FOMC debate, if any, will focus on potential losses that may be suffered by the Fed from asset and debt pricing (falling bond prices and rising interest rates).
The whole situation boils down to this: because a nonperforming bond is worth less than 100% of its face value, the Brady bond replaces the defunct debt as a new asset.
In May, New York's insurance commissioner, Eric Dinallo, urged Brown to move the capital to ease concerns about MBIA. The company announced its decision to move the capital on the same day Moody's published a report detailing what it saw as significant deteriorations in certain home equity and other asset-backed securities backed by bond insurance.
He added Greenwich Capital, a bond-trading outfit, and Gartmore, an asset-management firm, the following year.
More likely, the Fed is creating another asset bubble, this time in the bond markets.
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When they are deeply below net-asset value, as high-yield bond funds are now, they can be very good buys.
The bond-trading executive said nonbank investors such as asset managers, pension funds, insurers and the like have accounted for a large portion of the purchases of southern European bonds in recent weeks.
He is widely expected to undertake aggressive action that may include "open-ended" asset-purchase programs designed to push bond yields down, boost the supply of money in the banking system and spur lending to businesses.
But to this point, our sense is that major asset prices, like stock prices and corporate bond prices, are not inconsistent with the fundamentals.
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Cash holdings reached their highest level since June 2010 as investors moved money out of stock and bond investments last month, according to the October AAII Asset Allocation Survey.
But they would also harm the asset side of insurers' balance sheets, as bond prices fell.
E-Trade moved into asset management in February 1999 and set up a bond center four months later.
The Fed's asset purchases help keep down U.S. bond yields, and higher U.S. yields could also push up yields on Japanese bonds.
The story is similar with its top bond fund, the Virtus Multi-Sector Short Term Bond Fund, run by Virtus-owned money manager Newfleet Asset Management.
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The value of any such asset (real estate, stock share, or bond) is the sum of the future stream of cash flow or benefits, discounted by the interest rate.
So, for example, a sukuk issuer does not sell a debt, as a traditional bond issuer would, but rather sells a portion of an asset, on which the buyer is then entitled to receive rent.
Bill Gross, a fixed-income champion at Pimco, an American asset-management firm, predicted last September that bond returns will outstrip equities until share prices fall to their fair value, that is, until the Dow Jones Industrial Average is at 5, 000 rather than today's 8, 000-odd.
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Could the program help spur asset bubbles and set up a potential fall in the bond market?
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