Warning Signs Similar To Bear Stearns In 2007? Bond Spreads Narrow To Lowest Since 2007

The gap or spread between high yield debt (junk bonds) and investment grade corporate bonds is now the most narrow it has been since 2007.

And what happened in 2007?

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A number of hedge funds owned by former famous investment bank, Bear Stearns, started failing thanks to too many bad (over leveraged) bets on subprime housing and mortgage backed securities.



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