hi pip "debt is now cheap, PDLs are relatively cheap" all nicely...

hi pip
"debt is now cheap, PDLs are relatively cheap"
all nicely explained , but how do you come to the conclusion that PDL's are now cheap ???

"you can only get PDL's at discount when the economy is totally stretched"
likewise crazy , how do you come to that conclusion  ?????

some of my thoughts here -

1. company's sell their debt when the arrears reach a certain length of time, so on that simple analogy the value of the debt should be constant  when ever the debt is sold - so long as the parameters of the debt are constant, except that -

2. at a time when there is a lot of delinquent debt in the market, and when is this   ????

3. the volume of delinquent debt would increase with
(a) increased unemployment
(b) decreased or stagnant wage growth
(c) increased cost of living

we have got a bit of each here ?

4. and that there would be less delinquent debt when
(a) interest rates have been lowered, well for home owners anyway ......
(b) jobs and business is booming
(c) with wage inflation

and we have also got a bit of each here

5. of course there will be an increased amount of debt due to lower interest rates, but not necessarily delinquent debt..........

the lower interest rates should help CCP to recover debt more quickly, and it obviously reduces it's interest costs.......

ANZ did mention a decrease in delinquencies in their latest report - but that's only one off .......

not trying to be a smarty here guys, just trying to get my head around it all

gk