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Author: nittanyfan One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 77724  
Subject: Re: BDCs on Barrons Date: 4/23/2013 9:12 PM
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<<<<Are you sure that today's BDC's could weather another storm like the last one? Since I don't spend any time on BDC's, I do not have a current opinion. I would certainly be suspicious.>>>>

I guess that depends on the storm. If it was like the 2008 one , pretty much everything was hammered and beaten down, not just BDC's , so it would be tough to find a place to hide besides government bonds and cash. Junk bonds were yielding in the 20 percent range, high grade bond yields were in the double digits , REIT's were cutting dividends, blue chips were chopped in half or more and many pfds yields were teenagers.

Specific to BDC's , they have learned many lessons from the '08-'09 crisis. and many of the larger , stronger ones have diversified their funding sources - both the type (bank lines, straight debt, SBA debt) as well as the maturities of these instruments. That said, in a credit crisis , markets sell first and ask questions later. And BDC's lending money at double digit rates are not lending to worry free credits so your caution is something BDC investors need to keep in mind.
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