Credit and Debt Monitor – 1.31.2020

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  • The decline in the strength of the Q4 narrative of a risk of “collapse” in credit markets continued in January.
  • Uniquely among our macronarratives, cohesion actually dropped for debt and credit market narratives.
  • We think that the heightened attention on the coronavirus outbreak and generally positive news about the China Trade War were largely absent from the leveraged loan and private credit-focused discussions that dominated in late Q3 and early Q4.
  • We don’t think that these markets are as mass media-driven as equity markets and asset allocation / macro – so while we would generally argue that this has created a complacent narrative, we don’t counsel establishing any active positions on that basis.

Narrative Map

Source: Quid, Epsilon Theory

Narrative Sentiment Map

Source: Quid, Epsilon Theory

Narrative Attention

Source: Quid, Epsilon Theory

Narrative Cohesion


Fiat News Index


Narrative Sentiment

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