UBS' Mish Says He Is Cautious On Credit

The video discusses the market's pricing of recession risks, highlighting a divergence between credit market signals and macroeconomic data. It explores the potential for convergence, the impact of credit spreads, and factors causing market uncertainty, such as the goods versus services dynamic and the COVID rebound. The outlook for the credit market in September is examined, with expectations of heavy issuance and rising default risks. The video concludes with a comparison of US and European credit markets, noting Europe's cheaper investment grade market and potential ECB actions.

What percentage risk of a recession is the market currently pricing in according to the text?

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What are the two types of recessions mentioned, and what are their respective risks?

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What does the hard data component of the recession model indicate about the risk of recession?

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How does the current credit spread compare to historical levels according to the discussion?

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What factors are contributing to the uncertainty in the markets as discussed in the text?

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What is the expected default rate for leveraged loans according to the text?

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What is the anticipated impact of the ECB's actions on European credit markets?

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