Bear Devours Old Trading

摘要

The credit crisis set off a bear market characterized by an explosion in trading volumes and unprecedented intraday volatility. Not an asset class or a geographical marketplace got away unscathed. The bear devoured long-revered investment banks and sent others running into the protective arms of the Federal government bailout machine.rnThe financial services landscape as we've known it has been altered. Credit derivatives and collateralized debt have devastated the balance sheets of the banks and brokers.rnCapital is being reallocated, arid risk is being redefined.rnVolatility and concerns about counterparty solvency are changing the way traders behave. And liquidity reigns as king. Volatility has remained in nosebleed territory, resulting in a dearth of liquidity. When prices move in inexplicable ways with great speed, traders are reluctant to trade in any size. They are increasingly fearful of telegraphing any information about their orders to the marketplace, and they're unwilling to show a bid or an offer.