by Dave Kranzler, Investment Research Dynamics:
Is she worried about the large body of mutual funds that bloated up with derivatives? Is she worried about the lack of liquidity in the bond market? Did Mary Jo White see a burning bush that spoke to her about the system derivatives risk embedded in every crevice of the financial markets?
I warned everyone less than a year ago to get out of your bond mutual funds. Get out NOW. A good friend of mine who is a hedge fund consultant told me yesterday that he spoke to a big bond fund manager who is terrified about the lack of liquidity in the corporate bond market. This guy couldn’t get a bid on some paper he wanted to sell this week. A year ago he could have moved it in one phone call.
Please follow SGT Report on Twitter & help share the message.