On ambulance chasing and bottom picking

A curious little indicator as to whereabouts we are in the credit cycle this:

Bankruptcy-related M&A.

(Or in other words, shotgun mergers and acquisitions being made where one - or both - merging parties would otherwise go bankrupt.)

Note in the graph below, from ThomsonReuters, that in the last corporate default cycle, bankruptcy M&A peaked at pretty much the same point that global stock markets reached their bottom.

Obviously given that bankruptcy M&A is only really just beginning to take-off, it’s another datapoint to add to the markets-haven’t-bottomed-yet meme. Particularly instructive when taken with Moody’s latest monthly default figures.