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Michael Gracie

Signs liquidity is about to disappear from your market

FannieMaeLogo.gifLiquidity makes markets. Without a fair share of buyers and sellers to keep the spreads reasonable, nothing works. If you were to suck a big player out of the market, say one that provides a lot of “insured liquidity,” the same thing would happen, inefficiency, if not wholesale disruption.

What are some of the signs that a big player desperately needs an exit door?

Start with some fraud. Toss in backing out of early stage deals. Throw in a mass exodus of its managers.

I think that is plenty in the way of signs.

Comments

Karl Hallowell says:

It’s interesting how Freddie and Fannie have been accumulating dings over the years. Too bad I was on vacation when you wrote this article or I’d probably have more to say.

Michael says:

Interesting, possibly. Daunting, certainly.

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