henry peabody, mary bowers and alberto gallo.'s give you a market check unresponsive been this week. yields shaping up as follows. up by two basis points. even with the ugly auction earlier this week's, yields up by six basis points to 340. the final spread. the week ahead featuring a fresh read and comments from draghi and powell. this is "bloomberg real yield." ♪ jonathan: i am jonathan ferro. this is "bloomberg real yield." it is time for the final spread. we will have speeches from both jay powell and mario draghi. we have been opec meeting, key economic data from the u.s. and china, and italy will show its new budget to the european union. the list bond market is closed on monday for veterans day -- the u.s. bond market is closed on monday for veterans day. henry peabody, mary bowers and alberto gallo. can high-yield stay as it has done with this move lower? mary: as we have seen with the workings of the oil market, we cycle. mini defrost that flushed out a lot of the quality in energy. yes, there is a couple of bad actors b

henry peabody, mary bowers, and alberto gallo.et's get you a market check on where bonds have been this week. two's, ten's, and 30's, yields shaping up as follows. up on the front-end by two basis points, but a bit into the 30 year, even with that ugly auction this week. yields lower this week. 3.40 on a u.s. 30 year. the week ahead, featuring a fresh read on u.s. inflation and comments from both draghi and powell. this is "bloomberg real yield." ♪ jonathan: i am jonathan ferro. this is "bloomberg real yield." it's time now for the final spread. coming up over the next week, we will have speeches from jay powell and mario draghi. plus, we have an opec meeting, key economic data from the united states and china, and italy will show its new 2019 budget to the european union. a reminder, the u.s. bond market is closed monday for veterans day. still with me to discuss is henry peabody from eaton vance, mary bowers from hsbc global asset management, and alberto gallo from algebris investments. mary, we have to get you on the oil market

henry peabody, mary bowers, and alberto gallo.et's get you a market check on where bonds have been this week. two's, ten's, and 30's, yields shaping up as follows. up on the front-end by two basis points, but a bit into the 30 year, even with that ugly auction this week, 3.40 on a u.s. 30 year. the week ahead, featuring a fresh read on u.s. inflation and comments from both draghi and powell. this is "bloomberg real yield." ♪ the new default cycle in high-yield. that flushed out a lot of the lowest credit quality in energy. yes, what we have left are a couple of bad actors, but by and large, the credit quality is much higher and they can extend -- they can withstand lower prices of oil. jonathan: henry, is that your stress test? these companies are better? henry: you washed out a good deal of the market. on oil, one of the interesting things about it is this iranian situation and how trump has given outs to several nations ahead of the midterms. i think he knew he could not have $3.75 gas going into the midterms. midterms are behin

great to catch up with you, henry peabody, mary bowers and a gallo from algebris.will see you next friday at the same time, 1:00 p.m. new york, 6:00 london. this was "bloomberg real yield." this is bloomberg tv. ♪ [ phone rings ] what?! ready for christmas? no, it's way too early to be annoyed by christmas. you just need some holiday spirit! that's it! this feud just went mobile. with xfinity xfi you get the best wifi experience at home. and with xfinity mobile, you get the best wireless coverage for your phone. ...you're about to find out! you don't even know where i live... hello! see the grinch in theaters by saying "get grinch tickets" into your xfinity x1 voice remote. a guy just dropped this off. he-he-he-he. carol: welcome to bloomberg businessweek. jason: we're here in new york. carol: bloomberg businessweek is releasing its 30th annual ranking of the best schools in the united states. stick around for the winner. jason: the search for serious returns in the decade since the financial crisis.

joining me to discuss is henry peabody, mary bowers, and alberto gallo.ary, many people might have missed it. for leveraged loans it was the busiest month since may in october. that was october where everyone is going crazy, get the market was that busy. how? mary: they posted a small positive return in october. it outperform much of fixed income this year. clo demand has been enormous. we had over $100 billion of clo issuance and it is sucking the newest supply yield out. the technicals for high-yield have been good, despite massive outflows from the market. for now it looks like the leveraged loan space is still going to be able to have a lot of new issuance. we think it is getting frothy. it is not just the terms. there is a lot being discussed around the covenant light. frankly, we are seeing top-heavy secured cap structures. what ends up happening in the next cycle is it will erode the recovery values that typically have been high for leverage loans. at the same time we have been saying throughout the year the fundamentals look at a good for credit.

jonathan: joining me around the table in new york city is henry peabody, mary bowers. plus, from london, portfolio manager. mary come i will begin with you to see if you disagree with your colleague. the fed are thinking will remain on pace with the rate hikes. the one thing from a high-yield perspective -- i have been cautiously optimistic on high yields from the fundamentals perspective. we were a little more cautious this summer from the valuation perspective. we repriced 50 basis points in october, but we are starting to see concerning things by the -- bubbling from bottom up in terms of supply chain disruption and cost chain increases. it feels like putting plugs in the portfolio. the sector seems to have issues. despite theing us, repricing, concerned. now more from the fundamentals perspective it -- perspective. henry: i think it is spot on. on thequite stimulative front end. we are talking about moving up to neutral, 3%. we have a ways to go. what if it pushes into the high threes and productivity stays around 1%? expansionary more policy. the yawning deficit a