Bond Outlook [by bridport & cie, December 19th 2007]
In this last Weekly of 2007, may we leave you a question to ponder on over the break? Can a massive loosening of liquidity solve a solvency problem? Obviously the question itself implies a view, viz., that the immediate underlying cause of the current prices is the fall in US (and UK) housing prices and the terrible performance of mortgage-backed securities. This immediate cause is a manifestation of the USA’s living beyond its (considerable) means. |
It is worth recalling that the housing crisis is the underlying cause, as a return to healthy financial markets can only be achieved when the US housing market stabilises. |
Access intelligence that drives action
To unlock this research, enter your email to log in or enquire about access
