Sometimes, the only thing contagious is fear.
I’m still getting emails about credit contagion risk. And with each new stock-market high, someone quips, “What goes up…”
All this because last month brought back the eerie music of 2008, at least for a few bars.
Tricolor, the nation’s third-largest used-car chain; and First Brands, a parts maker with more hidden debt than fenders; imploded almost simultaneously. They’d allegedly pledged the same collateral to multiple lenders and stuffed some $2B of loans off their balance sheets.
Fifth Third Bank swallowed a $200M loss, JPMorgan $170M, Barclays $150M, and the financial commentariat reached for its favorite insect metaphor. “When you see one cockroach…” sighed Jamie Dimon.
Let’s turn a gimlet eye on the supposed infestation…
_________________
Free is fine, like boxed wine. Paid is uncorked, aged, and slightly judgmental in a way you’ll grow to love.
