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
