Comments on: Corporate and Government Bond Rates Graph

By: CuriousCat: S&P 500 Dividend Yield Tops Bond Yield - First Time Since 1958

CuriousCat: S&P 500 Dividend Yield Tops Bond Yield - First Time Since 1958 — Sat, 22 Nov 2008 05:11:11 +0000

“Dividends paid by Standard & Poor’s 500 Index companies in the past 12 months amounted to 3.51 percent of the benchmark’s closing value yesterday. In early trading today, the 10-year yield fell as low as 3.42 percent…”

By: CuriousCat: Discounted Corporate Bonds Failing to Find Buying Support

CuriousCat: Discounted Corporate Bonds Failing to Find Buying Support — Mon, 20 Oct 2008 12:21:02 +0000

I am not very familiar with the bond market but it does seem like the panic is in full swing but calling the bottom is always hard…

By: Myles

Myles — Sat, 11 Oct 2008 17:13:26 +0000

Great spread graph – very difficut to find such a telling graph on the web! The graph supports the concept that, with the exception of the 1873 panic, stock declines and widening spreads between low and high quality bonds are indicators of a looming financial meltdown. At some point, the spread will narrow after the panic, but if it should begin to widen again, as in the panic of 1907 and the Great Depression, it would signal the beginnings of an intense deflationary cycle – at least in historical studies.

By: Rob

Rob — Fri, 10 Oct 2008 04:30:11 +0000

The spread between government bonds and Baa corporate bonds increased to 362 basis points, the spread was 280 basis point in January. The rate on government bonds has barely change (decreasing from 3.74% in January to 3.69% now) so the change has nearly all been in increased corporate bond rates.