From the collapse of Lehman Brothers in September right up until the second half of November, US banks were entirely absent from the debt capital markets. It is a sudden turning off of the tap from a key source of funds.
In the first quarter of 2008, US banks and financial issuers had sold $97.5 billion of debt in the US corporate bond market; in the second quarter, they sold $133 billion, issuing at roughly the same rapid pace as in the second quarter of 2007, before the financial crisis had even begun.
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