John Authers, Columnist

The Case for Tighter Credit Spreads Is Compelling

Bond investors are demanding too much given the low risk of default. Also, Brexit’s the storm in the U.K. teacup.

April 12, 2019 at 4:01 AM UTC

John Authers is a senior editor for markets and Bloomberg Opinion columnist. A former chief markets commentator at the Financial Times, he is author of “The Fearful Rise of Markets.”

Bond investors are too greedy.
Photographer: Stephanie Keith/Getty Images North America

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Companies have been borrowing an awful lot, and leverage ratios are approaching record highs. For details, take a look at this graphical exploration that I produced last week with my Bloomberg News colleague Lauren Leatherby. But low interest rates make it easier to meet debt payments and refinance. Is it really possible that credit spreads, despite everything, should be even tighter?