Perhaps the market is starting to realize things are not as rosy as it seems. When investors feel the economic winds are on their backs, flows go proportionately to the different credit buckets, in fact one can argue that in an expansion, riskier bets are placed and the worst credit ratings get more money. As you can see in the chart below, investors are starting to differentiate between B rated bonds and BB and CCC. Lower quality bonds are being dumped in anticipation of an economic slowdown, or perhaps due to the inability of the Fed to lower rates due to higher than desired inflation. In the past, signals like this have sparked the end of the credit cycle, with spreads widening across the board.
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