CDO Trading At Near-Halt, Bloomberg Reports
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According to reports from Bloomberg, trading in CDOs is at a near-halt, citing traders at the American Securitization Forum's annual conference in Las Vegas.
Ross Heller, an executive director at JPMorgan Securities Inc., said, "We're definitely in a period of very low liquidity at the moment, which has actually been dropping precipitously in the last few weeks."
The slowdown in the $2+ trillion CDO market follows the record downgrades in mortgage-linked securities, which has caused some AAA rated debt to lose all their value.
Losses on CDOs, which package assets into securities with different risk profiles, has caused banks to write-down record amounts over the past six-months.
Ross Heller, an executive director at JPMorgan Securities Inc., said, "We're definitely in a period of very low liquidity at the moment, which has actually been dropping precipitously in the last few weeks."
The slowdown in the $2+ trillion CDO market follows the record downgrades in mortgage-linked securities, which has caused some AAA rated debt to lose all their value.
Losses on CDOs, which package assets into securities with different risk profiles, has caused banks to write-down record amounts over the past six-months.
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