Rate Desk May 15, 2020

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May 15, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Bond markets, industry valuations, and risk mitigation with debt service reserves.

Rate Desk Notes May 15, 2020
  • Indices up
  • Crude up $29.71
  • UST yields .62
  • Thresholds set on MF secondary market securities
  • 223(f) 2.50%
  • 221(d)(4) 3.15%
  • Fannie 3.20%
  • Freddie 3.20-3.35%
  • Unrated bond market dead (LIHTC, hospitals, infrastructure projects)
  • BBB bonds priced 5.25-5.50
  • MF industry facing 1-2 year cash flow crunch
  • No long-term valuation issues
  • LTV are much lower
  • DS reserves for risk mitigation
  • Upcoming topics:
    • Former Goldman Sachs trader on negative interest rates
    • LIHTC equity bridges and cash collateralized bonds
    • Construction costs senior housing