Sign Of The Times: Alphabet Borrows $10 Billion In Bond Market

Sign Of The Times: Alphabet Borrows $10 Billion In Bond Market

This is just an indication of what the liquidity conditions created by the Federal Reserve are allowing companies to do. The interest rates to be paid on the new debt were all at historical-low levels. Alphabet Inc. just borrowed $10 billion in the bond market, while it only had $4 billion in debt on its balance sheet before. Here is a Big Tech company, Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) that had just $4.0 billion in long-term debt, while at the same time it held $121.0 billion in total cash and marketable securities. Here is a Big Tech company that just borrowed $10.0 billion more in longer-term debt. What is going on here? This is just part of what is going on as a result of the actions of the Federal Reserve System to keep the financial system full of liquidity. And, it seems as if the Fed is achieving its goals. Joe Rennison writes in the Financial Times, Note further that the average yield on investment-grade bonds has fallen below 2 percent this past month, the first time that this has ever happened. Lots And Lots Of Money Around There is just no question that there is plenty of money around. In my recent post “The Investment Environment Is Among The Most Compelling Of Our Careers,” I emphasized the vast amount of money now available to the hedge fund community and what they are planning to do with all these funds. This is also true for asset management funds and private ...
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