Keeping active (TT JanFeb08 p36-38)

Have recent market conditions changed attitudes to risk and capital structure? Over the course of the last few months the world’s credit markets have experienced significant problems. Problems that began in the US subprime mortgage market and fed through to the broader market as participants began questioning how structured credit as a whole is analysed and priced, culminating in a liquidity crunch with, for a while, uncertainty over who the credible counterparties were.