Searching for symptoms of Enronitis has become all the rage. "The
one constant in the market is the herd mentality," says Mike
Kinneally, chief investment officer at Bank of America Asset
Management. "Misery loves company."
Tyco appeared to be a classic case. Within four weeks its share
price halved, bond prices would drop by $6 and recover again within
one day, and prices on the default swap went from as tight as Libor
plus 115 basis points to L+1150, with the widest trade struck at
L+875.
Enronitis simply provided an excuse. Such wild...
