AAA Paper? 92.5% Are Not
That headline is a bit of an exaggeration.
So what is the quality of the collateral willing to be accepted by the new Term Securities Lending Facility (TSLF)? As we noted earlier, much of this paper is junk.
Consider this recent survey of triple A (AAA) paper, at risk of losing their AAA rating in the ABX Indexes, via Bloomberg:
Click thru for interactive chart
Source: Bloomberg
Tuesday, March 11, 2008 | 12:41 PM | Permalink
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"Junk" is such a negative word.
We should call it "value challenged" paper.
Posted by: Marcus Aurelius | Mar 11, 2008 12:55:53 PM
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