Cantella Rates and Credit Dashboard--3/26/21

    It was pointed out to me yesterday that Fed Chair Powell indeed has changed his mantra from “whatever it takes” to “as long as it takes”. This may indicate that Powell recognizes both the faster than expected roll-out of vaccines and the pent up economy. As we know in life, but especially with the Fed, that words count. I find the Suez Canal situation fascinating. According to Bloomberg the blockage will last until Wednesday. Now ships are considering going around Cape Horn, which delays the trip for 5 to 7 days. Meanwhile the back log in container ships off the coast of L.A. will diminish as there will be more open slots to off load their cargo. This will help the global supply chain temporarily, but hinder it long term. Also the empty ships that come back to China to be reloaded will be delayed. Bottom line, the maritime flow of goods will be significantly altered for a while. How this will effect the global economy short term remains to be seen. One last thought….The price of one 40 foot container to ship from China has quadrupled in the last year. Another poor 7 year auction yesterday. 10’s open at 1.66% . In Cash Credit , High Yield continues to out perform Investment Grade. Netflix-NFLX-( Ba3/BB+ upgrade watch) is trading at +120 bps vrs 10’s . IG 36 opens at 57. Have a nice weekend.  

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