(Bloomberg) — High-yield bond default rates may double as companies struggle with a protracted economic downturn even as the Federal Reserve props up valuations, said Jeffrey Gundlach.The investment grade corporate debt market has skewed toward lower quality BBB- rated debt, but if just 50% of that were to be downgraded it could fuel a near doubling of the high-yield market, Gundlach said Tuesday on a webcast for his firm’s flagship DoubleLine Total Return Bond Fund.Gundlach’s views reflect broad skepticism about the market’s connection to economic realities. He criticized the Fed’s emergency actions as buoying asset prices and spurring unsustainable corporate …read more
Source:: Yahoo Finance
