Commercial paper decreases in August
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 have not been successful in preventing an overall contraction in the CP market.
罢丑别听聽and as of late August commercial paper continues to slump on a monthly basis while still rising 1.59% on a year-over-year basis to $1004.10 billion, a level that is still substantially lower than even the worst periods of the last two recessions.
