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How would a move into distressed debt be given markets are improving? Is this still area of finance just another bubble (like Tech M&A)? If one is a credit analyst/trader is there the possibility to move into macroeconomic trading later down the line. Is anyone close to the field that could provide an opinion? any thought much appreciated.

I'm in this asset class but not from a trading desk perspective but from principal investment - there are four key factors why I remain bullish about the asset class - they are inter-related to a degree:1) The supply of distressed credits never goes to zero - even at its minimal level it remains considerable2) The amount of investment capital available for the asset class is still dwarfed, even when supply is considered low3) The pricing and therefore upside is obviously less tasty if the economy is in a upswing, however there plenty of credit/name specific drivers and events to generate returns - you may have to do more trawling to find the right credits is all.4) Remains non-commoditised and will remain so for a long time IMHODon't know about people moving from DD to global macro - best way for that would be interest rate prop or fx directional prop - you're constantly punting macro drivers and triggers...

glad to see this topic is getting some action here on W.com:- recognize that there is a big difference between analyst and trader in this market, because the course of the future is heavily dependent on information that is not public. If you want the nonpublic info, you have to give up your trading rights.- at the very moment, pricing sucks in distressed and I consider the market to be bubblicious. I think it's hard to spend money right now, and other market players have said the same thing.- re: upswing I'd say you have to be careful about timing when you make a statement about performance. You want to buy on the cheap and sell rich - that's obvious. Easiest way to do that is buy when things look bad, restructure the company and grab as much equity as you can, and then sell the equity in a rising market. These days, the equity market will swing up "before the recovery" - i.e. you can sell a company for good money now even though the top line growth is still lame. Favorite case in point these days comes from all that AWIN equity I'm sitting on.- agree, will remain noncommoditized for the near future because there are key barriers to market efficiency that haven't been breached thoroughly yet.- so overall I'm not that crazy about the market right now and have considered which direction one could go. I think that DD is a great education for risk arb but a lot of risk arb will get done now as well. Other event-driven trading is a cool way to go, and requires serious brainpower... I like this area a great deal.One thing you have to think about in terms of supply/demand is the whole economic process of creative destruction. The bankruptcy process is supposed to separate the weak from the strong. When the market gets pumped up, that process can get delayed significantly. Overall, it's not really about market efficiency (i.e. that's why it's good to be in this business). As a mega-example, consider the airline industry. Everybody blames the weakness on 9/11, but in fact the industry has been crap for as long as anybody can remember. Many players have been through multiple bankruptcies already, so why is the government offering loan guarantees? The USAir CEO just quit, because even after fixing up their debts, they are not sufficiently competitive. This puts pressure on the rest of the pack, too, and everybody just drags along losing money. Back on the farm, you'd take the old horse around back and shoot it. In this case though, the glue factory just tells you not to do that, they'll pump the old horse up with medicine and laugh as it staggers about. There should be some kind of arb here - i.e. the rest of the industry should put up money to buy the company, strip the assets and put it out of its misery - but because of the situation, they don't have the money to do this. We used to own debt in a crap company that made ugly picture frames. We bought at around 70, and got out around par, with a bunch of fees, all with the complicity of new private equity. We just bought the company again, lending at 10%+, and had we been a few days late, the company would have been liquidated. Yes, we are making money, but in a way it bugs me. This stupid company should just die. Instead, we've drugged it up, and now we're trying to avoid getting charged by the mangy red-eyed horse we created.

Couple of questions.1. Is an I-bank prop. desk better than a hedge fund in terms of learning experience and future pay? 2. If you work on the advisory side (in restructuring, distressed debt, leveraged finance...etc) how many years of experience is necessary before moving into buyside? If you got the basic credit skills is it just better to make the move and learn at the desk?3. If one needs make the choice is credit investing (in the broader sense) or macroeconomic trading a better career move in terms of the future options it opens and the intellectual challenge it provides?