ABS

Optimism may be building that the Fed is poised to steer the economy toward a soft landing, but Treasury market has delivered what is widely understood as a starkly different message: The economy is veering toward a contraction.

The notes benefit from a step-up event concerning class D. If an optional redemption does not occur in the expected redemption date, then the interest rate on the class D notes will increase by 3.0%.

The renewed interest in CLOs, which repackage leveraged loans into bonds of varying risk and size, comes after a very slow year for the market.

Virtually all of the attributes in VZMT 2023-5 and 2023-6 are identical, such as the statistical cutoff date (August 7), aggregate principal balance ($23 billion) and weighted average (WA) remaining installments, 26 months.

The distribution of dealers among the top categories have improved, while the floorplan loans have monthly payment rates that are at record highs.

Some buyers such as insurance companies tend to prefer longer duration to match their liabilities. That dynamic has also made asset based finance much more important

One potential credit drawback is that 25% of the pool finances construction equipment loans.

The trust will repay notes through a $160.7 million, floating-rate class benchmarked to the three-month Secured Overnight Financing Rate (SOFR), and a $25.1 million of fixed-rate, class B.

Among the winners: Hedge funds betting that bond yields will rise anew. It's clear that Jackson Hole's hawkish message has been received loud and clear.

After a challenging 2022, fund flows reverted to positive territory in 2023 even though higher interest rates and wider spreads have considerably reduced the supply of securitized product.