The dislocation in ABX – the synthetic index of the 20 most liquid US subprime securitizations – has had a remarkably limited effect on the wider credit sector. Regulators will be pleased that despite a 15 point drop in the past months there are no obvious signs of distress elsewhere.
But there might well be some second-order effects from the belated realization that the US subprime market is in trouble. On these pages Euromoney has highlighted not just how serious the problems are but also the threat that the sector’s weakness poses to both the US economy and the financial system [Have Wall Street...
