"The credit market's on fire," said Suki Mann at Societe Generale. "We have seen a massive grab for yield. The mood is so good that even if Greece were to default it would probably make no difference."
The average borrowing cost for high-grade US companies has dropped to 3.52pc, just shy of all-time lows. American firms took advantage of the hunt for safe yield to raise $70bn (£44bn) last week alone, led by McDonald's and IBM.
The recovery in Europe has been electric since the European Central Bank (ECB) opened the floodgates in December, lending banks €489bn (£410bn) at 1pc for three years, with more to come later this month.
Europe saw the biggest one-month compression in high-grade debt yields in January since records began, excluding the V-shaped rebound after the 2008 crash. Telecom Italia's yields have dropped 180 basis points this year.
"The ECB was the game-changer. A lot of this money seems to have gone into corporate bonds and it makes sense because non-financial corporates are the strongest in history with big cash reserves and very defensive balance sheets," he said.
Data from Deloitte shows large companies have amassed record cash reserves on both sides of the Atlantic, with British non-financial firms sitting on £731bn, and US corporations holding $1.73 trillion in cash.
"High-grade companies like Google, Caterpillar, and the German auto-makers are now better credits than most governments," said Marc Ostwald at Monument Securities.
Spain's energy group Repsol can borrow for five years at 3.55pc, undercutting the Spanish state at 3.75pc. American companies cannot beat the US Treasury at 0.82pc but the gap has narrowed. Five-year yields for both Procter & Gamble and Caterpillar are 2.1pc, while GE is at 2.24pc.
Mr Ostwald said the world's central banks have eliminated most of the risk, promising to keep interest rates near zero for at least two years, even if the latest rush into junk bond segment of the market and is looking "overcooked".
Stephen Jen from SLJ Macro Partners said the double blast of a "trigger-happy Fed" and an activist ECB has transformed the outlook for global assets this spring. "All investors should respect the rule 'don't fight the Fed'. A new rule is 'don't fight the ECB'. Certainly the market should not fight the Fed and the ECB at the same time," he said.
Andrew Roberts, credit chief at RBS, said companies' ultra-cautious stance and their aversion to a fresh blitz of debt-drived takeovers makes them an alluring place to park money. These "super-corporates" have decoupled from eurozone woes. "The credit default swaps on Siemens, Carrefour, and Nestle hardly moved during the sovereign debt crisis last year," he said.
Bank bonds are the great exception to Europe's credit rally. The side-effect of the ECB's lending blitz is that the bank has gobbled up collateral. Since the ECB has first claim on this, the process reduces ordinary "unsecured" bondholders to ever lower ranking – affecting €2.6 trillion in European bank debt.
Holders of senior bank bonds are being relegated to junior status. "Banks are pledging more and more of their assets to the ECB: for unsecured bondholders, it all adds up to structural subordination," said John Raymond from CreditSights.
The risk is this could back-fire if banks over-indulge at the next ECB tender, borrowing a further €1 trillion or more. For now the party is in full swing.
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