Commercial paper outstanding: August 2011
The Commercial Paper (CP) market is essentially a private debt market used by corporations as a generally cheaper means of funding typical recurring operations than drawing on a line of bank credit.
Commercial paper, as financial instrument, is by no means a recent innovation and, in fact, you can read about how the CP market was affected by the many historic financial shocks experienced by the U.S. (read Panic on Wall Street: A History of America鈥檚 Financial Disasters).
Although the Federal Reserve was able to artificially bring CP rates down significantly since the shocking 615 basis point spread blowout (A2/P2 spread) of late 2008, they had not been successful in preventing an overall contraction in the CP market.
The and for August commercial paper outstanding presented a serious pullback dropping from a recent high set back in July and expanding at a meager rate of 3.16% on a year-over-year basis to $1097.80 billion, a level that is still notably lower than even the worst periods of the last two recessions.
