“Apple wowed investors last week with forecast-beating earnings that managed to boost optimism in asset markets around the world,” Matt Clinch reports for CNBC. “The company impressed markets again this Tuesday with the launch of a $12 billion bond deal. The issue was heavily oversubscribed – reports suggest demand reached the $40 million mark – and coincided with the anniversary of Apple’s 2013 debut issue, launched successfully before fixed income markets sold off.”
“Early on Wednesday, Apple 10-year securities yielded around 77 basis points above U.S. Treasurys. and market chatter focused on a possible euro-denominated issue in the near-future,” Clinch reports. “Meanwhile, equity investors seemed to have rediscovered their love for Apple, with Frankfurt-listed shares trading at 428 euros ($592), up from last April’s sub-$400 trough. Plus, Goldman Sachs raised its price target on the stock to $635 from $620 on Wednesday, a clear signal Apple may push U.S. bourses higher this year.”
“Nonetheless, one fixed-income strategist was critical on Wednesday,” Clinch reports. “‘Past performance is not a guide to the future. I want to see the evidence, the proofs, and the mitigants to make sure I’m going to get my cash back. Event risk can sink the credit of even the top names,’ Bill Blain, a senior fixed income broker at Mint Partners, a leading London agency brokerage, said in a morning note.”
Read more in the full article here.
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Bill Blaine can’t see the forest through the trees.
I cannot claim to be fully awake but I would imagine that one needs to keep ones brain powder dry before eschewing fourth remarks such as which Mr. Bill Blain has espoused. Remarks that proclaim that his flexibility has been fully affected by rigor mortis and any evidence thus portrayed to him would be rendered moribund by his condition.
Even the Egyptians know not to ruled by a mummy, one has to entombed deeply in a pyramid so that the rest of the living can carry on with business as usual.
Methinks that Mr. Bill Blain’s point of view is a pain that needs to be interred together with him.
There is a risk in any type of investing. But I seriously doubt that those buying the long-term bonds now will be holding them at the maturation date. The longer the bond term, the higher in rate of return so the increased risk is compensated by higher interest.
Especially when 35-40b was thrown into the pot in order to acquire 12b in bonds. CNBC, Seeking Alpha and Motley Fool should all be chased from the planet.
If you read the full text of Blain’s rant at Barron’s, it quickly becomes apparent that Mr. Blain has no business commenting on anything to do with Apple or the tech world. He’s clearly out of touch with reality.
Bill Blain’s Bogus Bullshit Bores.
An Apple bond is probably just about as safe as a US Treasury Bond. So i vote steer clear.
With the Fed likely to be tapering QE for the rest of the year sooner or later interest rates will spike and the bond market will be hit hard. No bond is a good buy right now.