Another 90s Bubble Anecdote.. we had huge Portfolio of ~35 Bridge Loans.. u got paid 50bps upfront fees.. for sending in a fax commitment letter.. before fax went beep beep..$HYG market took out Bridge... Free Money!
That’s the kind of Bubble it was.. this is nothing in .
Ironically... Koppers cited in that WSJ article... was bought with the Dillon Read Saratoga Fund Bridge that we were a big part of...
In the 21st Century with rates dropping to Zero + Fed $7Trillion Sheet etc ... & LIBOR dropping over 700bps to ~30bps.... High Yield Junk Bonds have Never traded to its 1997 tights of +237bps... the M&A back then was so frothy.. makes anything after GFC look boring.
#Facts
Now we are at 600+ bps over almost 3x the tights in the ‘90s... it’s an absolutely terrible comparison.
One of my favorites as a comp to the 90s Bubble... how many times have you shown up to an roadshow lunch & found a set of golf clubs as a deal toy? I wasn’t there.. but my colleague was...Admittedly, that was rare... even then...but actually one Dealer did make that happen.
5 day Bankers Trust conference now ...at the Phoenician... A Scheduled Golf event every single day after meetings that end at around noon.. Casino nights with all the Issuers... now you barely get a conference bag.. if you’re lucky. That’s 90s froth.
These anecdotes are the difference between Dealers trading at 5x TBV...vs 1.0x TBV today... this is so far from froth.. it makes one’s head spin.
#Reflation #M&A
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