MARKET INTELLIGENCE

Macroeconomics

The financial markets have not really calmed down and those hoping to see a settlement of some sort have been disappointed in the last two weeks. The uncertainties in the subprime market, which had been mainly focused on the private housing sector, are now spilling over into the commercial mortgage and derivatives markets, so that liquidity in this market has also dried up and the simple fact is that nobody can now evaluate risk anymore. The central banks are continuing to pour liquidity into the market to soften the consequences, but, if this will ever be enough is anyone’s guess as nobody knows how big the problem is yet.

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