(New York)

It used to be that companies issued bonds and asset managers bought them. The situation has changed, making companies the new top dog in the market. Because of their huge un-patriated cash piles, companies are buying up each other’s debt in huge volumes. American multi-nationals now own over $400 bn of US corporate bonds, amounting to near 5% of the total market. The buying is part of a move away from the money market accounts corporates used to rely on. In total, US corporates have over $2 tn in cash and securities.

FINSUM : This is an interesting level of interconnectedness that few talk about. It makes one wonders about vulnerabilities in the event of a crisis.

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