Search results
Results from the WOW.Com Content Network
The immediate trigger of the crash in the US occurred at the Federal Open Market Committee (FOMC) on February 3 and 4, 1994, although bond prices in Japan had started plummeting just a month earlier. [ 5 ] [ 8 ] Led by Chairman Alan Greenspan , the Committee reached a consensus to slightly raise its federal funds rate target from 3% to 3.25%.
The crash was apparently caused by a reaction to a news story of the breakdown of a $6.75 billion leveraged buyout deal for UAL Corporation, the parent company of United Airlines. When the UAL deal fell through, it helped trigger the collapse of the junk bond market.
The bonds of firms in the energy sector, who make up about 10% of the total junk bond market and were particularly exposed to the Saudi-Russian oil price war, suffered large yield spreads. [ 41 ] [ 42 ] [ 43 ] A debt default by energy companies would harm the regional banks of Texas and Oklahoma, potentially causing a chain reaction through the ...
After the buyout of United Airlines fell through on October 13, 1989, the ripples were felt throughout the stock market, specifically the junk bond market. CNBC reported this resulted in a 7% sell ...
"Bond crash in recent weeks means highs in credit spreads, lows in stocks are not yet in," Bank of America's Michael Hartnett said. ... News. 24/7 help. For premium support please call: 800-290 ...
The United States risks a bond market crisis of the kind that engulfed the United Kingdom 18 months ago, sending yields soaring and sparking a run on the pound, according to Congress’s ...
Due to several deals that did not work out, as well as an unexpected crash of the junk bond market, 1989 was a difficult year for Drexel even after it settled the criminal and SEC cases. Reports of an $86 million loss going into the fourth quarter resulted in the firm's commercial paper rating being cut in late November. This made it nearly ...
Nowhere has that been clearer than in corporate bonds - especially the riskiest speculative part of that market for so-called junk bonds, where many firms worst affected by lockdowns raise cash.