Monday, August 01, 2011

Where Can an Investor Turn?

To corporations of course.

With increasing speculation that credit ratings agencies will downgrade US sovereign debt, and with the value of a number of European bonds approaching junk status, investors are now casting about for new and safer places to put their money. Johnson & Johnson, maker of Band-Aid plasters and Listerine mouthwash, and SMRT, an obscure Singapore transport company, are among the corporations enjoying AAA ratings. The others are: ExxonMobil; Imperial Oil; Microsoft; back office outsourcing group Automatic Data Processing; Koch Financial Products, which leases assets to US government agencies and schools; medical research funder the Wellcome Trust; agricultural bank Rabobank; and Hong Kong transport group MTR.

"What we have seen is a big shift of money into very safe assets," says Luca Paolini at the Credit Suisse global strategy team. "We are not particularly bullish on corporate bonds but if you have a situation like right now in the US and you want to be covered from the risk of default that's the most obvious place to go."

  UK Guardian

....but hey, do what you will anyway.

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