Goldman bonds are on fire
Whether it is a result of calmer credit markets or the Fed’s open chequebook on Wall Street, Goldman Sachs bonds have enjoyed a scorching rally of late. You may recall a post here three weeks ago that pointed out that Goldman’s A-rated bonds were trading below the bonds of sub-investment grade BB-rated Brazil (see prior post “BB+ Brazil vs. AA- Goldman Sachs” March 11-08).
Well, Goldman’s 2037 subordinated bonds have rallied from about 86 to 96.36, such they the 6.75% bonds are now yielding merely 7.004%, a far cry from the 7.9% implied yield on March 11th.
Brazil’s 2037 debt is trading at 108.07, implying a yield of 6.59%, tighter than the 6.647% at the time of the last post.
Mind you, if you were dumb enough to trim part of your position in RIM (RIM:TSX) to buy the Goldman bonds, you’re still behind the game, as RIM has soared from C$95 to C$117 over the same period.
Who would have been stupid enough to not take their own advice and make that trade (see prior post “No more RIM predictions” June 28-07)?
MRM
(disclosure – I own GS, GS bonds, and RIM)
Mark, I apologize for this OT posting but we’ve just encountered what appears to be a major scam targeting small-cap Canadian CEO’s and taking place on a daily basis.
This is 100% true and verified by 6 clients and associates so far.
Full details here:
http://blog.agoracom.com/2008/03/31/agoracom-ceo-alert-canadian-small-cap-financing-scam-discovered/
Feel free to delete this post once you’ve read my blog post, as I know it is OT – but the fastest way to contact you at this time of the night.
Hoping you can blog about it and help spread the word to the media. Very serious stuff that can only get worse as you’ll see from my post.
Regards,
George Tsiolis
AGORACOM