There’s more financial market tubulence ahead. Okay, that’s a safe forecast. Still, the the Fed’s dramatic cut in the discount rate is probably enough to ease up the credit crunch. The conventional mortgage market should calm down in coming weeks.
That doesn’t mean there won’t be trouble. I expect that less attention will be paid to subprime mortgages and more attention to leveregaed buyout deals. There’s a lot of takeover debt that can’t be syndicated these days. The bank are stuck with owning the paper. Credit standards had gotten far too lax in the leveraged buyout market, and we haven’t seen the full extent of this fallout.
Stories You Might Like
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
