Below is a brief excerpt transcribed from Wednesday's edition of The Macro Show hosted by Hedgeye CEO Keith McCullough.

McCullough: High Yield Is A Disaster - 7 1 2020 12 04 06 PM

High Yield is a disaster!

We talked about it earlier in the week with the biggest 1-day outflow in Junk Bonds on the ETF side (JNK), ever.

Ever is a long time, and these facts just don’t go away.  

High Yield spreads yesterday went down 4 basis points. If you don’t know what that is…

That’s not a lot.

In fact that’s barely even down on the day.

So they have been able to pump stock markets, FOMO futures, and take advantage of the media’s narrative. That’s why Pump Jr. was tweeting what he did this morning.

You need this for the narrative.

But gravity doesn’t care about narratives.

Economic gravity appears on a trending basis.

The fact of the matter is that High Yield and Junk (which are the most speculative parts of credit and levered long investments that a lot of people have) are looking to me like they are headed right into the thralls of #Quad3 economic stagflation here in the 3rd Quarter.

McCullough: High Yield Is A Disaster - 7 1 2020 12 04 55 PM