Springtime has finally emerged on the eastern coast of the United States, heralded by a somewhat tempestuous transition in the credit markets. Headline risk in the automobile sector sent spreads all over the place and served as a change of pace compared with the constant drumbeat of airline woes and pension issues that are keeping analysts busy.

But it is always a good idea to take a step back and look at the big picture, in addition to the minute intraday movements that are normally the focus of our attention. So US Credit has taken a step back to look at a dynamic, ever-changing market: that of collateralized debt obligations. On page 24, we look at how banks are trying to boost the yields of investment-grade CDOs by including high-yield assets and increasing duration.

We also have a feature on page 42 that looks at increasingly complicated CDO structures in the market, and whether the buy side has met the challenge of increasing its level of sophistication in being able to manage the risk of these evolving structures.

I hope you enjoy the issue.

Richard A. Bravo, Editor

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