Recovery in the US economy may fade

By John Godley, head of fixed income at Sarasin Investment Management The corporate bond rally ...

By John Godley, head of fixed income at Sarasin Investment Management The corporate bond rally that started last October has seen spreads on single-A and triple-B rated bonds return to levels not seen since before the LTCM crisis in 1998. I do not believe now is a good time to relax credit underwriting standards and wonder if some of the recent more cyclical spread tightening moves will be reversed later in the year. While we at Sarasin have been very happy to take the excess returns from having an aggressive credit position during the last 10 months, we have chosen not to invest...