More fallout from Bear Stearns hedge fund woes

Where this goes is anyone's guess. But it is fair to say that credit anxiety continues to spread. The issues with Bear Stearns two credit-oriented hedge funds brought to light a host of problems that seem bound to hit other funds. We've noted that collateralized debt obligations (CDOs), especially the low- and mid-tier tranches, have seen prices plunge. Who is going to buy this stuff right now--given the liquidity issues? And given the likelihood that rating agencies will likely be forced to lower ratings even more. Last week, according to The New York Post, Goldman Sachs wrote down $1.5 billion worth of its CDO inventory--the first top investment bank to do so. Others will likely follow. Of course, some made the right bet. MKP Capital Management has fared well shorting subprime mortgage paper. 

For more:
- here's the article from The New York Post