CDOs: Weathering the subprime storm

1. Introduction

If you believe all you read in the mainstream media, collateralised debt obligations are either dead or terminally wounded. Some commentators have dreamed up apocalyptic epithets to describe them, with Money Morning calling CDOs "obscure, tottering towers of debt".Others have administered the last rites in colourful, flowing editorials. "Within a few months, the crisis will be past, and a slow convalescence will be established," wrote Hamish McRae in the UK broadsheet, The Independent, in Ma